The Dow Jones Industrial Average and the S&P 500 Index were both slightly down last week, while the tech-heavy NASDAQ was up just a bit. It seems that the slowing labor market has finally had an impact on the stock market. Inflation and consumer sentiment reports due this week will provide some insight on the current bull market.
I had the opportunity to speak with students in the financial professional track at my alma mater last week. They asked me “What is the biggest mistake you see clients making financially?” I replied that it’s really not a mistake I see that hurts people, it’s a lack of focus and intentionality with their finances. Which is completely and totally understandable. We are all incredibly busy. Work, family, household chores, maybe volunteering, taking care of pets, other family members. And then throw in a subject most people don’t receive education around, and ask them to make hard choices with no understanding of the long-term impact. It’s hard to say someone has made a mistake there.
At the same time, choosing to get your financial house in order, and commit to some changes, can have a lasting impact, sometimes over generations. If you’ve listened to the Monday Money Report for a while, you’ve heard all of this. But it’s the same with diet and exercise: we all know we should eat better and exercise more. It’s making the decision to change, and then sticking with it.
Here’s some small steps you can take before the end of the year, to help you start 2026 on the right foot financially. First, get your will and other legal documents done. We generally prefer clients work with an estates and trust attorney, but if the best you can do right now is an online option, do that. It’s better than nothing.
Second, write a list of your assets, or what you own, and your liabilities, or what you owe. It’s called a balance sheet. The difference between the two is your net worth. While you’re at it, go through your credit card and checking account statements to make a budget. Remember that a budget is not a plan – it’s what you actually spend your money on. It’s like a diet. We all have a diet. The fact that mine included six Oreos last night doesn’t mean it’s not a diet. Your budget may include large amounts for eating out, an expensive car, pet care, or kids’ activities. Get a handle on where your money is really going, so that you can make conscious decisions about your spending.
Once you know what you have, what you owe, and how you spend your money, you can begin to make small changes. Build your emergency savings to $1,000 and then tackle any debt outside of your mortgage. Invest in your employer’s retirement plan to get the matching money they’ll contribute.
These steps will start the process. Working with a financial planner to see the long-term impact of decisions can also help. And it’s important not to beat yourself up. You’ve probably made some really smart decisions along the way; now we just want to take the next step and continue to improve your financial position.
Your action item this week is to change your passwords. If you don’t use a password keeper, consider one, and make certain you’re using strong passwords that you change several times a year.
Check out our website at covingtonalsina.com, or our Facebook page, for more information and our upcoming educational events.
CovingtonAlsina is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.