Budgeting equals awareness

Eagle Wealth Management |
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Weekly Market Commentary


This one is for all you yogis, meditators, and Buddhists out there. You want to achieve enlightenment? The key is not in down dogs and green smoothies. The key is budgeting.

We know that sounds crazy. But take it from Thich Nhat Hanh, “Budgeting leads to enlightenment.”

Just kidding, Thich Nhan Hanh didn’t say that. But he did say, “Awareness is like the sun. When it shines on things, they are transformed.”

As any good scholar of Buddhism knows, awareness is the key to enlightenment. Well, what better way to become more aware than by budgeting?

Being aware of our spending is one of the most powerful tools we have to become aware of ourselves. And really, that’s all budgeting is! It’s simply being aware of our spending.

We don’t run into too many people who love to budget. And when it comes to co-budgeting with a spouse or partner, there’s a good chance at least one of you will actually hate the idea.

And yet, anyone who takes the time to think about it would agree that spending money in a way that’s more aligned with our values will bring us more happiness.

So why aren’t we doing it?

1 - It’s not fun.

True. But remember, as Stephen Covey says, “If the ladder is not leaning against the right wall, every step we take just gets us to the wrong place faster.” Budgeting is how we make sure our spending ladder is leaning against the right wall.

2 - I already know where my money is going.

No, you don’t. Sorry. Unless you track your spending, you don’t have a clue where your money goes. Everyone we’ve seen go through the process of tracking spending for 30 days usually ends up saying some version of, “I had no idea I was spending that much on X."

3 - I’m not sure I want to know.

This may be the biggest mental hurdle. The reality is that as we become aware of what and how we’re spending, we’ll find some things that surprise and bother us. Then we have to decide: Do we want to change?

The answer to that last question is… Yes! Of course, you want to change!

Why else would you be contorting your body into weird shapes in a heated room with people chanting "Om" at you? Right? The whole point is to become more aware.

Just give it a shot.

1 - Try tracking your spending for 30 days.

2 - Don’t stress about what app to use.

3 - Just carry around a pen and a little notebook, and each time you make a purchase, write down what you spent and how it made you feel.

4 - At the end of the month, go back through your notebook and just notice. Become aware. That’s it.

What do you have to lose?
 
 

 

The Week on Wall Street

The overhang of Fed Chair Powell’s Jackson Hole speech the previous week carried over into last week as investors recalibrated stock valuations amid a seemingly more assertive monetary policy stance.

The Dow Jones Industrial Average fell 2.99%, while the Standard & Poor’s 500 stumbled 3.29%. The Nasdaq Composite index lost 4.21%. The MSCI EAFE index, which tracks developed overseas stock markets, slid 4.90%. 1,2,3

Stocks Extend Losses

Investors remained unnerved by the aggressive tone of Jerome Powell’s speech and subsequent comments from Fed officials suggesting a higher rate hike than the market expected at the Fed two-day meeting ending September 21. The probability of a 75 basis point hike in September rose to nearly 65%, up from just 28% a month ago. 4

Stocks moved steadily lower before finding some footing on Thursday. Friday’s employment report appeared to strike a “goldilocks” note (i.e., labor gains not so strong that it might trigger greater Fed hawkishness but robust enough to allay imminent recession fears). After early gains, stocks turned lower ahead of the holiday weekend. 

Employment Shines

Employers added 315,000 jobs in August, maintaining the labor market’s remarkable resiliency amid a contracting economy. The unemployment rate rose to 3.7%, up from last month's 3.5%. The gain followed an uptick in the labor participation rate, which expanded from 62.1% to 62.4%. Wages continued to grow, rising 0.3% in August and 5.2% from 12 months ago. 5

Sectors seeing the most significant increases in new jobs were professional and business services, healthcare, and retail. Lagging sectors were manufacturing, financial, and wholesale trade. 6 

THE WEEK AHEAD

KEY ECONOMIC DATA


Tuesday:  Institute for Supply Management (ISM) Services Index
Thursday:  Jobless Claims

 

Source: Econoday, September 2, 2022
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

COMPANIES REPORTING EARNINGS


Thursday:  Zscaler, Inc. (ZS), Docusign (DOCU)
Friday:  The Kroger Co. (KR)
 

Source: Zacks, September 2, 2022
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

 

 

 

 

 

1. The Wall Street Journal, September 2, 2022
2. The Wall Street Journal, September 2, 2022
3. The Wall Street Journal, September 2, 2022
4. The Wall Street Journal, August 29, 2022
5. CNBC, September 2, 2022
6. CNBC, September 2, 2022
 
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.
The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.
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This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The content is developed from sources believed to be providing accurate information; no warranty, expressed or implied, is made regarding the accuracy, adequacy, completeness, legality, reliability, or usefulness of any information. Consult your financial professional before making any investment decision. For illustrative use only.