Happy New Year! I hope that your holidays were spent with family and friends, and that you are looking forward to the new year.
January 1st brings the hope of new beginnings and resolutions. For the Moore family, it is the beginning of ski season! As most of our clients know, we are a little fanatical about how much we love skiing. And yes, little Donovan will be out on the slopes this year. Well, not skiing just yet, but having some fun in the snow.
On a professional note, our team at Moore Wealth is very proud to announce that Sean has earned his Certified Financial Planner® Certification. The CFP® certification is respected among financial services firms, financial professionals and the public. It is recognized as the standard of excellence for competency and ethics in financial planning. As part of their certification, a CFP® professional commits to the CFP Board to act as a fiduciary—which means to always act in the best interests of the client when providing financial advice and financial planning. This milestone represents the latest in our ongoing commitment to delivering the quality guidance you deserve.
In this quarter’s newsletter you’ll find the following articles:
Moore After Hours Events: Spring Cybersecurity workshop and Summer Client Appreciation Night at Keys Stadium
By: Sean Moore, CFP® AIF®
One of the foundational elements of financial planning – perhaps the foundational element of financial planning – is budgeting. Budgeting, however, can be challenging, not because it’s intellectually difficult, but rather because it can feel like a chore of elimination and reduction. “Being on a budget,” like “being on a diet,” can feel like an exercise in determining what you must deprive yourself of now, in the hope of a future benefit. Separate from the mechanics of maintaining a budget, changing the mentality or approach to budgeting can be the most important step.
At Moore Wealth, we seek to approach budgeting as having a structured plan for cash flows into, out of, and within your household. Shifting your mental framework for budgeting from “I’m on a budget,” to “I am budgeting,” might seem subtle, but the distinction can be really powerful.
When you are “on a budget,” you’re more likely to be thinking about what spending you need to eliminate. In addition to not always being a pleasant thought, this framework can end up being counterproductive. Depriving yourself of spending on a thing or an experience now can lead to “revenge spending” in the future (think: people spending more on travel after Covid-19 restrictions were lifted). On net, this might result in the same amount of total spending, and in dramatic cases, you might end up spending more than if you hadn’t restricted yourself in the first place. This whipsaw effect can leave you wondering why you went through the exercise in the first place.
When you are budgeting, you are focused on allocating your resources, in service of goals. Allocating your resources in service of needs, wants, and wishes is a much more sustainable mental framework to budgeting, and it can allow for a much more satisfying set of outcomes. When you budget for your needs, followed by your wants, followed by your wishes, it gives you the ability to more readily recognize when it’s ok to splurge or be frivolous. Budgeting this way can also help you to focus on your priorities. You’re less inclined to “revenge spend” because you didn’t deprive yourself of something in the first place – you allocated your resources toward something important to you, even though that something might be in the future.
Budgeting might be the most foundational element of financial planning. If you could use support with budgeting, reach out to the Moore Wealth team. We have resources available – from worksheets to web-based services – that can guide you toward a sustainable practice of resource allocation.
Presented By: Shabri Moore, CFP® AIF®
Effective January 2024, significant changes to social security benefits were enacted with the passing of the Social Security Fairness Act (H.R. 82). This law repealed the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), which previously reduced social security benefits for individuals receiving a government pension.
The Social Security Fairness Act (H.R. 82) repealed the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) reductions to social security benefits due to a government pension. This was signed into law on January 5, 2025, and is applicable to benefits payable after December 2023.
WEP and GPO used formulas to reduce social security retirement benefits, spousal benefits, or survivor benefits.
If, over the course of your career, you worked as a federal, state, or local government employee as well as in the private sector where you did not pay social security taxes on your earnings, you may have been subject to WEP and/or GPO.
These rules affected former police officers, firefighters, teachers, certain nonprofit employees, and other types of government workers.
The Social Security Administration (SSA) will need time to determine how and when these adjustments will be made. SSA has provided information on what will occur next:
“I previously filed for social security benefits, and they are partially or completely offset.
“At this time, you do not need to take any action except to verify that we have your current mailing address and direct deposit information if it has recently changed. Most people can do this online with their personal social security account without calling or visiting social security. Visit ssa.gov/myaccount to sign in or create your account. We will provide ongoing updates regarding implementation on this page.
“I have not previously filed for social security benefits.
“If you are receiving a public pension and are interested in filing for benefits, you may file online at ssa.gov/apply or schedule an appointment.”
For updated information, check the Social Security Administration website at SSA.gov.
If you have a background in public service, this information could be particularly relevant to your retirement planning. Please don’t hesitate to reach out to our office if you’d like to discuss how these changes might affect your financial strategy.
By: Erik Moore
The stock market in 2024 delivered a strong performance, but the year was characterized by both impressive gains and underlying vulnerabilities. While market benchmarks posted solid returns, much of the growth was driven by a select few mega-cap companies, raising questions about market breadth and the sustainability of the tech rally.
The “Magnificent 7″—Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Alphabet (GOOGL), NVIDIA (NVDA), Meta Platforms (META), and Tesla (TSLA)—were responsible for over 65% of the S&P 500 gains in 2024. This level of concentration has fueled skepticism about whether the broader market is as strong as headline numbers suggest.
While their growth has fueled market optimism, the reliance on these seven companies raises concerns about vulnerability to shocks in the tech sector. A pullback in any of these stocks could disproportionately impact the broader index.
The 2024 stock market highlighted both the resilience and fragility of key sectors. Technology’s dominance drove remarkable gains, but the sector’s valuations invite skepticism about how much further it can run without broader market support. Energy and consumer discretionary stocks demonstrated strength, while traditional sectors such as utilities and real estate faced rate-related challenges.
As the Federal Reserve signals potential policy shifts and inflation continues to evolve, investors will need to carefully navigate a market that has become increasingly reliant on a small set of winners. The focus for 2025 will be on achieving more balanced growth and ensuring that economic strength extends beyond the tech giants that have defined recent years.
Presented by: Moore Wealth
December was a mixed month for equity markets.
Rising interest rates caused bond prices to fall at year-end.
The economic updates released in December showed continued economic growth.
Markets face a number of risks both domestically and abroad.
We believe the most likely path forward is for continued market appreciation and economic growth.
December was a mixed month for markets, as investors pulled back from most U.S. stocks due to concerns over rising interest rates and economic uncertainty. Despite the year-end sell-off, all three major U.S. indices finished the quarter and year in positive territory. The S&P 500 lost 2.38 percent in December but managed a 2.41 percent gain for the quarter and an impressive 25.02 percent gain for the full year. The Dow Jones Industrial Average dropped 5.13 percent in December but was up 0.93 percent for the quarter and 14.99 percent over the full year. The technology-heavy Nasdaq Composite led the way with a 0.55 percent gain in December, which contributed to a 6.35 percent gain for the quarter and a 29.57 percent rise for the year.
Despite the mixed results in December, fundamentals were supportive. Per Bloomberg Intelligence, the average earnings growth rate for the S&P 500 in the third quarter was 9.1 percent. This is well above analyst estimates at the start of earning’s season for a 4.2 percent increase and highlights the continued fundamental health of U.S. companies. Over the long run, fundamentals drive market performance, so the continued earnings growth during the quarter was encouraging. Looking forward, analysts expect to see continued earnings growth in the fourth quarter and throughout 2025.
Technical factors were supportive as well to end the year. All three U.S. indices spent the entire month well above their respective 200-day moving averages. (The 200-day moving average is a widely monitored technical signal, as prolonged breaks above or below this level can signal shifting investor sentiment for an index.)
International equities experienced a challenging end to the year. The MSCI EAFE Index fell by 2.27 percent in December, which contributed to an 8.11 percent decline in the fourth quarter and just a 3.82 percent gain for the year. Emerging markets held up a bit better but also saw a year-end drop. The MSCI Emerging Markets Index lost 0.09 percent in December and fell 7.84 percent in the fourth quarter. On a full-year basis, however, the emerging markets index was up 8.05 percent in 2024. A strengthening dollar and rising political upheaval contributed to the year-end declines for international stocks. Technical factors were challenging for international stocks as the MSCI EAFE Index spent most of the month below its 200-day moving average, while the emerging markets index fell below trend by the end of the month.
The stock market weakness was echoed by bond markets, which were also down to end the year. Long-term interest rates rose notably in December as the 10-year Treasury yield rose from 4.17 percent at the end of November to 4.57 percent at year-end. The Bloomberg Aggregate Bond Index lost 1.64 percent for the month and 3.06 percent for the quarter; however, the index managed to eke out a 1.25 percent gain for the year.
The rising interest rates during the month were due in part to updated guidance from the Federal Reserve following the conclusion of the Fed’s December meeting. The Fed lowered short-term interest rates by 25 basis points at this meeting, which was widely expected by investors and economists. What was less expected was the updated economic projections that showed the average Fed member expected to see just two more 25-basis-point rate cuts through the end of 2025, which was less than previously forecast. This means that the Fed remains cautious about the economy and inflation, and that it will be making decisions on a meeting-by-meeting basis in 2025.
High-yield bonds were also down for the month, as the Bloomberg U.S. Corporate High Yield Index dropped 0.43 percent in December. Despite the year-end decline, the index managed a 0.17 percent gain for the quarter and a strong 8.19 percent return for the year. High-yield credit spreads were volatile in 2024; however, they started the year at roughly 3.4 percent and ended the year at 2.9 percent. Tighter credit spreads indicate increasing investor appetite for higher-yielding securities and help explain the overperformance for high-yield bonds compared to investment-grade bonds during the year.
Despite the volatility to end the year, the economic updates released in December continued to point toward solid economic growth. The November job report showed an encouraging rebound in hiring during the month following a weather-driven slowdown in October.
Consumer sentiment also showed signs of improvement, with the University of Michigan Consumer Sentiment survey improving for the fifth consecutive month in December. Historically, higher levels of consumer confidence have helped support faster spending growth, so this was an encouraging sign for future consumer spending.
Speaking of consumer spending, the November retail sales and personal spending reports came in strong, indicating solid consumer spending during the important holiday season. As seen in Figure 1, this now marks three consecutive months with strong retail sales growth. This is a positive sign for the health of the overall economy in the fourth quarter, given that consumer spending accounts for the majority of economic activity in the country.
While the solid economic updates released in December were welcome, the stock market turbulence during the month served as a reminder that markets face real risks as we kick off 2025. Domestically, the primary risk is political. With a new administration and Congress, investors will be keeping a close eye on any policy proposals that could impact markets, especially when it comes to the inflation outlook. Part of the rise in long-term interest rates at year-end has been attributed to rising investor concerns about inflation in 2025 due to the policy uncertainty from Washington.
Foreign risks also remain that should be watched. The wars in Ukraine and the Middle East, as well as the recent political turmoil in France and South Korea, are prime examples of the geopolitical uncertainty that could impact markets. While the direct impact of these events has been limited so far for U.S. investors, we need to keep an eye on these potential sources of risk.
Overall, though, we are still in a pretty good place to start the year. Markets fundamentals were impressively resilient throughout 2024, and this momentum is expected to carry over into 2025. Analysts expect to see continued earnings growth throughout the year, supported by a strong job market and rising consumer confidence.
Looking ahead, we believe the most likely path forward for the economy and markets is further growth and appreciation in the upcoming months. With that being said, December’s mixed results are a valuable reminder that we may face short-term setbacks along the way. Given the potential for short-term turbulence, a well-diversified portfolio that matches investor goals and timelines remains the best path forward for most. If concerns remain, however, you should speak with your financial advisor to go over your financial plans.
Disclosure: This material is intended for informational/educational purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Please contact your financial professional for more information specific to your situation.
Certain sections of this commentary contain forward-looking statements based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. Diversification does not assure a profit or protect against loss in declining markets. All indices are unmanaged and investors cannot invest directly into an index. The Dow Jones Industrial Average is a price-weighted average of 30 actively traded blue-chip stocks. The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. It excludes closed markets and those shares in otherwise free markets that are not purchasable by foreigners. The Bloomberg Aggregate Bond Index is an unmanaged market value-weighted index representing securities that are SEC-registered, taxable, and dollar-denominated. It covers the U.S. investment-grade fixed-rate bond market, with index components for a combination of the Bloomberg government and corporate securities, mortgage-backed pass-through securities, and asset-backed securities. The Bloomberg U.S. Corporate High Yield Index covers the USD-denominated, non-investment-grade, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB+ or below. One basis point (bp) is equal to 1/100th of 1 percent, or 0.01 percent.
Thank you to everyone who joined us for the annual “Walk a Mile in Their Shoes” event in support of Heartly House. Our group this year was small, but mighty!
Join us for our 2025 Moore Wealth Spring Seminar
“Cybersecurity Awareness”
Date: Thursday, April 24th at 6 pm
Location: Delaplaine Arts Center
Register Here
On Friday, August 29th, at 7:00 PM, we invite you to enjoy a night of great company, fun, and exciting entertainment at Harry Grove Stadium. This exclusive event is our way of saying thank you for your continued trust and partnership.
Come celebrate with us in a relaxed and festive atmosphere, and enjoy the game, delicious food, and special surprises throughout the evening. We can’t wait to see you there!
Register HereAdvisory services offered through Moore Wealth®, a Registered Investment Adviser. Moore Wealth is located at 50 Carroll Creek Way, Suite 335, Frederick MD 21701. They can be reached at 301-631-1207.