After a few years of news about interest rate hikes, we finally have some news of an interest rate cut.
Interest rates were cut for the first time in four years and after more than 5 percentage points of increases taking place from March 2022 and July of 2023. The Federal Reserve cut U.S. short-term interest rates by a half-percentage point in mid-September.1
What does this mean for you? This means that as borrowing costs move lower, other interest rates are likely to follow. As a result, consumers, investors and business owners may have opportunities to:
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Pay lower interest rates on auto and home loans. Mortgage rates have fallen nearly 2 percent since last October in anticipation of this rate cut. And as of this writing, a 30-year fixed-rate mortgage was down to an average of 6.09 percent, its lowest rate since February 2023. So if you’ve been waiting on the sidelines to buy a home, now might be the time to look into it.2
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Refinance mortgages at lower rates. If you took out a mortgage at the 7 to 8 percent rate range over the past years, you might consider refinancing now at a lower rate.
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Tap into home equity at a lower cost. MarketWatch reported that demand for home-equity lines of credit (HELOC) were already surging ahead of the rate cut and that demand is expected to continue to rise. As of this writing, the average rate for HELOCs was 8.77 to 11.06 percent.3,4
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On the negative side, the rate cut might mean that some of your savings vehicles might be earning less. For example, high-yield savings accounts have reached returns above 5 percent in recent high-interest rate years. Those yields might go down slightly in the coming months. We recommend still having a high-yield savings account for your emergency fund. The rate cut also means lower returns on certificates of deposits (CDs).
If you have questions on money moves you should be making after the rate cut, please get in touch!
Battling Loneliness
What comes to mind when you hear the word “epidemic”? Most likely it’s some contagious physical ailment or sickness. But you know what else is an epidemic, according to the U.S. Surgeon General Dr. Vivek H. Murthy? Loneliness.5
“Loneliness is far more than just a bad feeling,” Dr. Murthy said in a report. “It harms both individual and societal health.”
Dr. Murthy noted that loneliness—which can lead to an increased risk of cardiovascular disease, dementia, stroke, depression, anxiety and premature death—has been on an upward trajectory for 20 years. But the loneliness epidemic was exacerbated by the COVID-19 pandemic. Dr. Murthy notes that the impacts of loneliness can be as harmful to our health as smoking 15 cigarettes a day.5
And while more than 60 percent of U.S. adults feel lonely occasionally, the American Psychological Association reports that approximately 30 percent of U.S. adults experience loneliness at least once a week, and 10 percent say they feel lonely every day.6
Cigna reports that there are five ways to address loneliness if you’re experiencing it.7
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Acknowledge your feelings and seek help. Whether it’s talking to your family members or a therapist, seek support.
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Decide when to engage or disengage from social media. Be honest with yourself whether social media helps you feel better. If not, disengage for a time. But if it helps you feel more connected, engage.
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Connect through volunteer opportunities. You can find a volunteer opportunity—such as tutoring kids or visiting seniors—that can help you feel more connected and fulfilled.
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Join a club or group. Identify your hobbies and then seek out groups or clubs that align with them so you can meet new people while doing things you like to do. For example, if you like to run, find a local running club.
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Engage in self-care. Develop an exercise routine where you can get some sunlight every day and stick to a healthier diet that focuses on whole foods and limited sugars. Plus, it’s always helpful to get a full night of sleep.
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Loneliness impacts so many of us. But if we actively seek to connect, we can battle it successfully.
Prepare for Winter Spending
October is pretty much the unofficial start of the holiday season. And if you’re anything like most people, you likely increase your spending during this time of year.
There are a myriad of reasons spending increases this time of year, but the biggest reason is the holiday season. And according to the Deloitte Holiday Retail Sales 2024-2025 report, this year is gearing up to be another expensive one.8
Deloitte forecasts an increase in holiday sales from 2.3 percent in 2023 to 3.3 percent this year. Retail sales from November 2023 and January 2024 totaled $1.54 trillion. And e-commerce sales are expected to grow from 7 to 9 percent from 2023 to 2024. In 2024, e-commerce sales totaled an estimated $270 billion.8
While this sounds like a big jump, this projected increase in retail spending from 2023 to 2024 is more in line with slower pre-pandemic levels. Our spending ticked even higher during the pandemic.
But still, spending is going to be a little higher during this quarter but Forbes reports there are three ways you can rein in and keep your spending in check this season:9
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Be intentional about budgeting. Now at the beginning of the quarter is a perfect time to set your spending limits and budget for the upcoming holidays. You can scope out all the best deals for your holiday gift shopping. More retailers are offering deals earlier and earlier. For example, Amazon had “Prime Big Deal Days” on Oct. 8 and 9.
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Manage debt strategically. As you’re likely spending more this time of year, you might also be putting more of those purchases on a credit card. Leverage your cards strategically by choosing one specific card to use, versus multiple cards, and then devising a plan to pay off the debt.
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Invest. You can also spend a little bit in the stock market. Get in touch with us if you’d like to revisit and expand your investments.
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With a little planning, you can handle the additional spending! Give us a call and we’ll make a game plan together.
Easy Chicken and Broccoli
Nothing quite hits the spot like being able to whip up your take-out favorites with better taste and healthier ingredients. And we already know that eating healthier can help us battle loneliness! So try this delicious chicken and broccoli recipe:9
What you’ll need:
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- ½ cup of low-sodium chicken broth
- 1/3 cup of reduced-sodium soy sauce
- 3 cloves garlic, finely chopped
- 3 tablespoon honey (or if you’d rather, you can use 2 tablespoons hoisin sauce and one teaspoon of light brown sugar)
- 2 tablespoon cornstarch
- 1 tablespoon of finely grated peeled ginger (tip: freeze fresh ginger the night before and it’s easier to peel!)
- 2 teaspoons of toasted sesame oil
- 1 tablespoon of neutral oil (like avocado oil, light olive oil, coconut oil or grapeseed oil)
- 1 pound of boneless, skinless chicken thighs or breasts, cut into half-inch pieces
- 2 medium heads broccoli, cut into bite-sized florets
- Cooked brown or white jasmine rice (healthy tip, brown rice is more filling because it contains more fiber)
- Toasted sesame seeds, for sprinkling on the dish after the dish is done
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How you’ll make it:
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- In a small bowl, whisk broth, soy sauce, garlic, honey, cornstarch, ginger and sesame oil until cornstarch is dissolved.
- In a large skillet or wok over high heat, heat neutral oil.
- Cook chicken, undisturbed for about 1 to 2 minutes, until it easily releases from pan.
- Stir and continue to cook, stirring occasionally, until golden brown on all sides and just cooked through.
- Transfer the chicken to a plate.
- In same skillet over medium-low heat, toss broccoli in broth mixture.
- Cover skillet and let broccoli steam until crisp-tender.
- Uncover and return chicken to wok or skillet.
- Cook, stirring until sauce is thickened and chicken and broccoli are well coated.
- Divide rice among plates or bowls.
- Serve the chicken and broccoli over the rice and top with sesame seeds.
- Enjoy!
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The Loneliness Quiz
As you found out in this newsletter, loneliness is an epidemic. Let’s find out how much you know about loneliness.10
- According to Psychology Today, upon the subjective quality of what does loneliness depend?
a. One’s abilities
b. One’s relationships
c. One’s income
d. One’s fulfillment
- Chronic loneliness increases risk of early death by what percentage?
a. 34 percent
b. 24 percent
c. 14 percent
d. 4 percent
- Loneliness makes us feel:
a. Colder
b. Like our bodies are under attack
c. A and B
d. None of the above
- True or false: More than 60 percent of lonely people are married.
a. True
b. False
Quiz Answers:
- B – One’s relationships
- C – 14 percent
- C – A and B
- A – True
Best regards,
DEAN, JACOBSON FINANCIAL SERVICES
Securities and Retirement Plan Consulting Program advisory services offered through LPL Financial, a Registered Investment Advisor, member FINRA/SIPC. Other advisory services and investment advice offered through Dean, Jacobson Financial Services, LLC, a Registered Investment Advisor, and separate entity from LPL Financial.
