Every so often I step back from the day-to-day work we do — the Roth conversions, the beneficiary forms — and just look at the bigger picture. Where are we, really, in the long arc of the market? And not just the stock market, but the bond market and interest rates too.
This time, I was reminded why the background is different today vs. the last three decades.
Yes, stock valuations are stretched — sitting at a level we’ve only seen once before, in the final months of the 1999 dot-com bubble. That part isn’t shocking. What is worth your attention is the story I almost didn’t lead with: the bond market seems to have completed its own 40 year cycle, and I think it may matter more to your plan than anything happening in stocks right now.
And then, while I was literally finishing this piece, the Fed’s whole policy narrative flipped in the space of a week — a good reminder of exactly why we don’t build our client’s plan around forecasts.
I also went back and pulled 125 years of market history myself, to see what it actually says about how downturns recover — not the headline version, the real data. What I found is the actual math behind why we recommend a combination of a cash reserve and a long-term portfolio, and it’s more reassuring than you might expect.
No hot takes, no market calls — just the data, where it came from, and what I think it means for how we manage risk for you.
Julia Peloso-Barnes, CFP®, is CEO/Sr. Wealth Adviser and Founder of Prism Planning and Solutions Group, a dba of PPSGRP, LLC (PPS), an SEC Registered Investment Advisor. Julia is also a member of the Ed Slott Master Elite Advisor Group and has been helping clients seek empowerment through collaborative problem-solving for more than 30 years. Learn more here.
Neither Prism Planning and Solutions Group nor PPS provide tax or legal advice, and nothing in this communication should be treated as such. This communication should not be interpreted as a recommendation for a specific investment, legal or tax-planning strategy. We provide this material for informational purposes only. We have not independently verified all information and it may not reflect the most current regulatory guidance. This article discusses general tax and legal considerations and should not be relied upon as legal or tax advice. Before making any decisions related to your own tax, legal and/or investment situation you should consult the appropriate professionals.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, and CFP® (with plaque design) in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
