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Balboa Wealth Named Runner-up in AZ As One of the 50 Fastest Growing RIAs

By Jeff Gilbert

Balboa Wealth Partners is proud to announce that we’ve been selected as a runner-up in Arizona for Citywire’s 50 Growers Across America report! We’d like to thank our dedicated clients for allowing us to be your advisor of choice, as well as our team for providing you with the tools needed to grow and shield your wealth. Here’s more about the report and how we made it on the list. 

How the List Was Determined

The 50 Growers Across America special report is the brainchild of former Citywire RIA editor Alex Rosenberg, which he implemented in 2020. Each year, the Citywire team receives and thoroughly reviews information from Discovery Data to determine the top 50 fastest-growing RIAs across the country. They run this list through several layers of analysis to get an accurate picture of which independent advisors are eligible for consideration. 

They then use this data to assign each RIA what they term a “growth factor.” This number determines each advisor’s place on the list and is based on their performance over the previous year in areas such as percentage growth in AUM, monetary growth in AUM, and percentage growth in employees. Each firm on the list is then contacted by the team at Citywire for participation in the report and is invited to an awards ceremony. 

Pictured below is Alex Aretakis, one of our advisors in the Scottsdale, Arizona office, accepting this award at the conference in Austin.

Balboa at Citywire conference

What We Have Done to Grow

We strive for excellence in all we do at Balboa Wealth Partners, and our success is proof of that mindset. While there is a lot involved in how we pursue and achieve excellence, there are a few main factors we can attribute to our growth. 

Clients Come First

Our mission here at Balboa Wealth Partners is to serve as a guide and advocate to our clients so they can turn their financial goals into reality. We are passionate about listening and understanding what is important to you. Beyond investment and financial planning advice, we care deeply about helping you reach your short-term and long-term goals. 

Attract New Advisors

One of the main goals of our firm, along with serving as a trusted advisor for our clients, is to provide a supportive environment where Investment Advisors can have the collaboration and resources of a larger firm but still run their businesses independently. We have even added multiple team members to our AZ office in 2022 alone.  

Industry Expertise

Not only do our advisors represent a wealth of industry expertise in various areas, but as a firm, we make it a goal to stay on top of market trends and share that knowledge with our clients. We do this by publishing a brief weekly market commentary on our website, along with other content on the topics of wealth management, retirement, and investing. 

We Are Grateful for You

While we are certainly proud to be included on this esteemed list, we wouldn’t be here if it wasn’t for our clients. We value the trust you place in us to guide you toward financial independence as we help you pursue your financial goals with confidence. 

At Balboa Wealth Partners, our goal is to deliver uncompromising advice, exceptional investment strategies, and outstanding service to our clients. Thank you for helping us become one of the fastest-growing RIAs in Arizona in 2022. We look forward to years of success in providing you with value and services that help your wealth grow. If you have any questions or would like more information on partnering with us, reach out to us at 949-445-1465 (CA), 480-801-5100 (AZ), or email [email protected]. 

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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My Experience at the Cooperstown Adult League Baseball Tournament

By Jeff Gilbert

For many years, I’ve maintained a passion for America’s favorite pastime, playing in adult baseball leagues throughout the seasons. These leagues have not only been a source of camaraderie but also a way to keep the thrill of the game alive in my adult years. A few times each year, I’ve had the privilege of teaming up with old friends and teammates to participate in baseball tournaments. 

Today I wanted to share a bit about my unforgettable experience playing on the iconic Doubleday Field in Cooperstown, New York, and my first visit to the Baseball Hall of Fame.

Doubleday Field

It was a dream invitation—I was invited to play for the first time in the adult league baseball tournament in Cooperstown, a veritable mecca of baseball. Arriving in Cooperstown, I was immediately struck by the idyllic beauty of the town, but it was the sight of Doubleday Field that truly took my breath away. As I stepped into the historic ballpark, the same turf once graced by baseball legends, I couldn’t help but feel a profound connection to the history of the sport.

The Hall of Fame 

Beyond the tournament, my time in Cooperstown held another highlight: my first visit to the Baseball Hall of Fame. Walking through the halls of this shrine to the sport, I was surrounded by baseball’s rich history, from Babe Ruth’s iconic bat to Jackie Robinson’s game-worn jersey. It was an awesome reminder of the profound impact baseball has had on American culture as well as the hearts of its fans.

A Championship Moment

As the tournament progressed, my team advanced, and finally we stood victorious on Doubleday Field, champions of the Cooperstown adult league baseball tournament. It was an incredible moment, a culmination of years of dedication to the game.

My journey to Cooperstown was more than just a baseball tournament; it was a pilgrimage to the heart and soul of the sport I love. It was a reminder that no matter how many years I’ve played, the game still has the power to surprise, inspire, and bring people together.

Team Up to Leave a Legacy

At Balboa Wealth Partners, we believe in creating a life that includes your passions and purpose. We take the values you love and integrate them into a financial plan that builds into a lasting legacy. If you’re ready to team up, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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Don’t Leave the IRS a Tip: The Importance of Tax Planning and Reviewing Your Return

By Jeff Gilbert

Instead of working on our taxes, most of us would rather…well, do just about anything else. Sure, it’s not exactly fun, but one of the best ways to retain more of your wealth (and we all want that) is to reduce the burden of taxation. An ongoing tax strategy can reduce your tax bill and keep as much of your money as possible out of the IRS’s hands.

Think of it like a game: If you understand all the rules of tax law, you will have a greater chance of “winning”—or, in this instance, reducing your tax bill and paying less. Rather than just crossing your fingers and hoping for the best, let’s look at some tips on how to make that a reality. 

Build a Tax-Efficient Retirement Plan

When working with your financial advisor, retirement planning will often be a key point of conversation. By stress-testing your plan, you can quickly see if your current retirement accounts, savings rates, and other assets will be adequate for the retirement lifestyle you desire.

A direct way to reduce your tax bill is to contribute money into tax-deferred savings accounts, such as a 401(k) or IRA. But, in order to maximize your savings, you will need to determine both your current cash flow needs and your ideal retirement income. A proper financial plan will look at both factors and determine the best way to use your tax-deferred savings accounts to save you money both now and in the future. 

For example, a $50,000 withdrawal from a Roth IRA will have a wildly different tax impact than that same distribution from a traditional IRA. Creating a tax plan can help you strategically withdraw from your various retirement accounts and reduce your tax liability. 

Contribute to Your Health Savings Account

Health savings accounts (HSAs) offer triple the tax savings. This may sound too good to be true, but HSAs have no federal income tax, no state or local taxes, and no Federal Insurance Contribution Act (FICA) taxes. If you are eligible for an HSA, your money will be tax-deferred and can be withdrawn tax-free to pay for medical expenses. 

Because HSA account balances roll over from year to year, by contributing to the limit each year, you can build up quite a nest egg to cover either current medical expenses or future medical expenses in retirement. Think of it as a Roth IRA for medical expenses. 

As of 2023, HSA owners now have higher contribution limits to help them do just that. If you have individual coverage, you can contribute $3,850; for family coverage, the limit is $7,750. There is also an extra catch-up contribution of $1,000 available for those age 55 and older. If you can’t max out the yearly limit, attempt to contribute enough to cover your deductible and take advantage of your employer match, if available. 

Use a Roth IRA to Transfer Wealth

Roth IRAs are an attractive savings vehicle for many reasons, including no required minimum distributions (RMDs), tax-free withdrawals after age 59½, and the ability to pass wealth tax-free to your heirs. Although Roth IRAs don’t have RMDs, other accounts like a traditional IRA might. This will force you to increase your income and could bump you up to a higher Medicare range, which can add $100 to $150 each month in premiums.

You probably know the effects taxation can have on your assets and the inheritance you hope to pass on to future generations. For example, if you passed down a traditional IRA, non-spouse beneficiaries used to be able to stretch the distributions from that account over the beneficiary’s life, but now they have to liquidate the account within 10 years of inheriting it (with some exceptions), thanks to the new SECURE Act. This significantly decreases the value of the account due to the amount of taxes paid in a short time. But, if you pass down a Roth IRA instead, there is no income tax due on the distributions, as long as the account is held for more than five years and the account holder is 59½ or older. 

If you have traditional IRAs already or earn too much to qualify for a Roth IRA, consider a Roth conversion to remedy the tax loss. The basic process to convert your IRA is to withdraw the amount you’d like to invest in a Roth, pay the tax owed on the distribution, then reinvest it into a Roth account. Be sure to work with a professional to determine the best time to do this so you don’t push yourself into a higher tax bracket or are forced to use funds from the account to pay the extra taxes on the distribution.

Deduct Eligible Charitable Contributions

Annual gifts to qualified charitable organizations may be deemed an eligible itemized deduction. Under the Tax Cuts and Jobs Act, fewer taxpayers itemize deductions due to the doubling of the standard deduction. Regardless, charitable giving is still a useful tax-minimization strategy.

In order to benefit from charitable giving, you’ll have to plan ahead. With the new higher standard deduction, you’ll need to make sure your total deductions for the year, giving included, exceed $13,850 for an individual filer and $27,700 for those married filing jointly. If your deductions fall below this amount, consider bunching your giving or doing several years’ worth of giving in one year.

You may also want to look into using a donor-advised fund to combine all charitable contributions in a year and then distribute the funds to various charities over several years. With this strategy, you may be able to itemize deductions in one year and take the standard deduction in the following years so you can achieve a tax benefit that you may not have received otherwise.

Review Your Previous Tax Returns

You can learn a lot from the past. Look at your previous tax returns with a professional to search for deductions or credits you may have missed, opportunities to lower taxable income, and plan for the next tax season. Take these factors into consideration when making a tax plan for the future:

  • Review notable tax law changes for 2023 that may affect you
  • Review your capital gains and losses
  • Review your retirement savings options
  • Consider Roth IRA conversions
  • Consider additional year-end tax strategies
  • Understand potential tax law proposals

Get Ahead With Tax Planning

Time spent on your tax strategy is worth the effort—as it can potentially save you money both now and in the future. But the key is partnering with an experienced professional who can help you understand how each possible opportunity works and how it fits into your big-picture strategy and long-term goals. 

With years of experience in financial and tax planning, our team at Balboa Wealth Partners knows how to implement appropriate tax-minimization strategies to help you save more of your hard-earned money. And our mission is to be your guide to financial independence. 

If you have questions about any of these tax strategies and whether they’d be right for you, give me a call at 949-445-1465 or email me at [email protected] to schedule a  no-obligation conversation. To reach our Scottsdale office, call 480-801-5100 or email [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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Investing for the Long Term: How to Beat the Market Without Trying

By Jeff Gilbert

The market is a complex beast, and there are millions of people who are trying daily to tame it. It can be frustrating to see someone analyze trends carefully and make incredibly successful investment choices, while you feel like your results are only earning minimal results. We can feel that unless we become a genius in market trends, we won’t be successful.

However, with many years of experience under my belt, I can confidently say this is not the truth. You don’t have to outsmart the market in order to be successful. You don’t have to stress and worry about making the perfect trade. Successful investments are attainable and here’s why.

You Can’t Outsmart the Market

Outsmarting the market usually involves attempting to “buy low and sell high” by analyzing current market trends for inefficiencies or volatility indicators. This is a common strategy used by both portfolio managers and everyday investors alike. It may work sometimes, but it is far from perfect. 

In fact, a new SPIVA report shows that 68% of active fund managers underperformed their benchmarks in 2022. The long-term results of this report are even more significant: 84% of active fund managers underperform after 5 years and 95% underperform after 20 years.

Not only does outsmarting the market involve guessing when to buy in, but you then have to guess when to sell. That means for every gain, you have to be right twice to make timing the market worth it. Unfortunately, market moves can only truly be spotted in hindsight, and outsmarting the market is often closer to playing the lottery than it is to an educated guess.

You can be a successful investor simply by relying on time in the market instead of timing the market. The longer you stay invested in a particular asset, the more likely you are to experience growth over the long term. Considering the S&P 500 Index has averaged around 9.4% for the last 50 years, this strategy doesn’t seem all that bad. Buying and holding often results in much lower stress and a more secure investment experience for the average investor over the long term.

Riding the Wave Is Less Expensive

Trying to outsmart the market has been around just as long as the market itself, and though it rarely works, many people keep trying. Not only are you less likely to outperform the market through market timing, you could further reduce your returns depending on how often you trade. That’s because outsmarting the market can be expensive. 

Depending on your account type, asset class, and where you are executing your trades, you will likely be charged for every purchase and sale you make, and that’s on top of any taxes owed on gains. The more frequently you trade, the higher your transaction costs will be.

If you held the assets for less than a year, your gain will be taxed as ordinary income at your marginal tax rate, which can be as high as 37%. 

Even if you find an actively managed fund that is able to beat the market, they have to do so by a wide enough margin to cover its higher costs and more. As such, even some funds that beat the market end up with lower returns once fees are taken into account.

Staying Invested Produces Better Returns

Many investors will sell their positions during times of volatility in order to avoid or reduce a loss. But how do they know when to buy back in? This is one of the most difficult aspects of outsmarting the market, and it often leads to much less growth than staying invested the whole time would have produced. 

For instance, a recent study by Schwab Center for Financial Research found that bad market timing is worse than investing immediately, regardless of the market conditions at the time of investing. This indicates that even in market downturns, or just before a downturn, investors who invest immediately and remain invested will be better off than those who stay on the sidelines or attempt to time the market. 

The time value of money tells us that a dollar today is worth more than a dollar tomorrow, and this is certainly the case when it comes to investing. The longer you are invested, the more likely you are to ride out the fluctuations of the day-to-day market and experience growth. 

Do You Have a Successful Investment Strategy?

The market is unpredictable and often takes everyone by surprise. Like picking the winning lottery numbers, the odds of picking a winning stock market strategy that never takes a tumble are pretty low—if not impossible. A successful investment strategy is one that can tune out the noise and focus on the long term instead. 

It’s this focus that we at Balboa Wealth Partners take pride in. It is our joy and honor to work with clients to create a plan that can help them reach their goals and beyond. When you partner with us, you’ll find years of knowledge and skills being used for your unique financial situation. Investing is for the long term, so start planning now. Give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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2023 Midyear Market Update

By Jeff Gilbert

Oof. 2023 isn’t shaping up to be much friendlier than 2022. However, there is some good news: the first half of the year has shown some signs of progress. 

Let’s take a deeper dive into those areas, as well as what you can do to prepare for the second half of the year and beyond.

The Markets Are Up

So far in 2023, the performance of the financial markets has been measured, yet positive. While the Dow Jones remains effectively flat, mirroring its position from this time last year, the S&P 500 has seen a modest rise, up 8.6% for the year to date. The Vanguard Total Stock Market Index Fund, providing a broad snapshot of the entire U.S. market, aligns closely with the S&P 500, reflecting an 8.2% increase. The tech-centric NASDAQ has shone brighter, growing a noteworthy 23% this year. 

However, adopting a longer-term perspective paints a slightly different picture. Over the course of the past year, all these indices are essentially unchanged from their positions this time in 2022, suggesting a degree of stability in the midst of fluctuating market conditions. 

Underlying these market movements, the U.S. GDP maintains positive, yet isn’t high enough to be called robust. Meanwhile, the Federal Reserve continues its trend of gradually raising interest rates. Despite this seemingly stable backdrop, it remains uncertain how these various forces will influence the stock market’s performance in the second half of 2023. 

Employment Is Strong

The U.S. employment scene shows steady progress with an unemployment rate of 3.4%. Despite this promising figure, representing 5.7 million active job seekers, there are complexities beneath the surface. While unexpected job losses and short-term unemployment have decreased, the numbers of long-term unemployed and part-time workers desiring full-time roles remain a concern. Also notable is the rise in people outside the labor force but eager to work, up to 5.3 million.

GDP Is Growing

The U.S. economy has shown signs of rebound in Q1 2023 with an annualized GDP growth of 1.3%, slightly exceeding the initial estimates and market predictions of 1.1%. Consumer spending growth outperformed expectations, rising to 3.8% despite ongoing high inflation. 

This growth, while not overly impressive, still stands in contrast to 2022, which saw two negative GDP quarters. It is also expected to continue, with forecasts predicting a growth rate of 1.5% by the end of the second quarter. 

The Federal Reserve, Interest Rates, and Inflation 

The Federal Reserve has raised its key interest rate to the highest level in 16 years to combat high inflation. However, this streak of 10 hikes could be nearing its end as the Fed assesses their impact on economic growth and inflation. Despite these increases, inflation remains above the Fed’s 2% target, currently sitting at 5%, far lower than its peak of 9.1% in 2022. Finally, the rising costs of goods and services, as well as tighter lending requirements and higher interest rates, could hamper the economy in the second half of 2023 as well as 2024. 

The World Is Experiencing the Same Issues As the U.S.

Global growth is projected to decline from 3.4% in 2022 to 2.8% in 2023, the lowest medium-term forecast in decades, largely due to the tight policies needed to curb inflation, deteriorating financial conditions, and geopolitical tensions. Inflation is expected to decline from 8.7% to 7% between 2022 and 2023, but the return to ideal inflation rates is not expected before 2025. Despite the cautious outlook, the MSCI All Country World Index is up over 7.5% so far this year.

Focus On What You Can Control

Understanding these economic data and projections can be a crucial part of preparing for the rest of 2023, but it’s only part of the story. To make the most of these insights, you must integrate them into a comprehensive financial plan that addresses your personal goals. For instance, how much do you need to save to meet your retirement goals? How much can you safely distribute from your accounts each year? Are your investments structured optimally for your financial situation? No matter what the economy, the Federal Reserve, Congress, or inflation does for the rest of the year, these are factors within your control. 

At Balboa Wealth Partners, your needs come first no matter what’s happening with the economy. We specialize in overseeing your financial affairs, coordinating the day-to-day execution of your long-term financial plans, and keeping you from falling victim to common retirement pitfalls. To learn more, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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Common Retirement Mistakes and How to Avoid Them

By Jeff Gilbert

Making mistakes is an inevitable part of being human, and we often use past mistakes as a way to learn and make better decisions in the future. However, in retirement, there is far less room for error. Making such a significant financial transition involves shifting from earning an income and building wealth to depending on that wealth to sustain you for the rest of your life. Even if you’ve been preparing for retirement for years, it’s important to stay vigilant in order to avoid making costly mistakes. 

Rather than coasting on autopilot, there are several key decisions and actions you can take to help smooth the transition into retirement. Let’s explore five common mistakes made by retirees and discuss tips on how to avoid them.

1. Overspending in Retirement

Do you know what you will do with your newfound freedom in retirement? Many people start by pursuing all the things they didn’t get to do while working—traveling the world, picking up a new hobby, remodeling their home, and the list goes on.

But many people underestimate the amount of money they’ll spend in those first few years of retirement. With so much extra time on your hands, it’s easy to make a lot of little purchases that add up to a lot over time. 

If you want to avoid this mistake, create a detailed but realistic budget and stick to it. Yes, you can budget for extras such as a vacation or a new hobby, but make sure you know how it will affect your nest egg before you follow through with it. And be sure to work with your advisor to find a withdrawal rate that will stretch your money for as long as possible.

2. Underestimating Healthcare and Long-Term Care Costs

Retirees receive Medicare after age 65, but most of the time, this isn’t enough to cover chronic healthcare needs in retirement. For example, did you know dental, basic vision, over-the-counter medication, and long-term care are not covered by Medicare? 

The average couple at age 65 will spend $315,000 after tax on medical expenses. What’s more, the real retirement enemy often comes in the form of long-term care costs. Nearly 70% of retirees will need some form of long-term care during their lifetimes, and with average long-term care costs hovering around $315 per day or $9,584 per month for a private room in a nursing home, it’s critical for you to have a plan in place to cover these expenses. 

First, cautiously watch your spending in retirement to ensure there is a financial margin in place to protect you when larger medical bills hit later in life. And when choosing your health insurance for retirement, make sure you understand all Medicare options and supplements and work with an experienced professional to help you evaluate your options. Finally, explore your long-term care coverage options, such as traditional long-term care insurance, life insurance with a long-term care rider, and annuities with long-term care riders. The earlier you get coverage, the better, since the older you get, the higher your cost for a long-term care insurance policy will be and the greater the likelihood of your application being denied.

3. Overreacting to Stock Market Volatility 

Retirees usually want to play it safe in the stock market, by investing conservatively and safeguarding their nest egg as much as possible. But when you play it too safe, your savings can’t keep up with inflation and you end up losing money down the line. With inflation hitting a staggering 9.1% in 2022 and still hovering around 6% in February 2023, most retirees can’t afford to avoid the stock market volatility that comes with investing at least a portion of their savings in growth assets.

Since your retirement may last anywhere from 20 to 30 years—as much time as you’ve spent in the workforce—don’t get caught up in investing too conservatively just to avoid short-term volatility. When your portfolio is too conservative, inflation becomes the biggest threat to your assets. 

4. Claiming Social Security Too Early

Don’t assume it’s best to start collecting Social Security at age 62 (or at full retirement age, for that matter). If your full retirement age is 66, for example, you could receive a 32% increase in monthly benefits by waiting to collect Social Security until age 70. This means if your standard benefit amount is $1,500 per month, you could receive $1,980 by waiting four more years. This equates to thousands of extra dollars over the course of your retirement.

When deciding when you should start collecting Social Security, consider the size of your nest egg, your retirement date, and the current state of your health. Calculating when to claim your benefits is both an art and a science. If you need help, reach out to a trusted financial advisor who can help you run the numbers.

5. Miscalculating Taxes on Retirement Income

Your retirement accounts are all taxed differently. If you don’t have a strategic withdrawal plan in place, you could end up with a large tax bill at the end of the year. For example, a $50,000 withdrawal from a Roth IRA will have a wildly different tax impact than that same distribution from a traditional IRA. If you blindly take your money and run, you could trigger an avalanche of higher Social Security taxes, investment surtax, capital gains taxes, and even higher Medicare premiums, which will eat away at the funds that were supposed to carry you through retirement. Creating a tax plan can help you strategically withdraw from your various retirement accounts and minimize your tax liability. 

Speak with a financial planner or tax advisor about creating a tax-efficient distribution strategy for retirement. This professional can look at your tax bracket, retirement accounts, and Social Security to help you withdraw money in the most tax-efficient way. 

Partner With a Professional

Although it’s impossible to avoid all mistakes, it is essential to take proactive steps toward a satisfying retirement. At Balboa Wealth Partners, we specialize in wealth management and can assist you in sidestepping the expensive mistakes often made during retirement. As your dedicated partner in this journey, we can collaborate with you to create a practical budget and develop a tax-efficient distribution strategy to help increase your savings. If you’re interested in our services and how we can help you enjoy a worry-free and comfortable retirement, give me a call at 949-445-1465 or email me at [email protected]. Or complete a complimentary risk assessment here.

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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Don’t Let Your Wealth Slip Away: Tips for Making Your Money Work for You

By Jeff Gilbert

As a high-net-worth individual, you have likely worked hard to accumulate your wealth. But that doesn’t mean you shouldn’t make smarter financial moves to maximize the wealth you have already built. At Balboa Wealth Partners, our mission is to be your guide to financial independence. That’s why we’ve put together this list of our top 10 tips for making your money work for you—not the other way around.

Develop a Comprehensive Financial Plan

The first step is to set clear financial goals and develop a comprehensive financial plan. After all, you can’t make your money work for you if you don’t know where you want to go! Make sure your goals are specific, measurable, and realistic. Common financial goals include saving for a down payment on a house or vacation home, building up an inheritance for children or grandchildren, and achieving your ideal retirement lifestyle. Once you have a clear goal in mind, you can create a plan to get there and manage your money in ways that will work toward your ultimate goal.

Diversify Your Investments

High net-worth individuals have a wide range of investment options available to them. To maximize your wealth and make your money work for you, consider diversifying your portfolio and exploring a range of investment vehicles. Diversification is key to managing risk and realizing long-term growth. Spread your investments across a range of asset classes, including stocks, bonds, real estate, and alternative investments. Within each asset class, consider investing in a variety of sectors and industries to further diversify your portfolio. 

Working with a financial advisor who understands your goals and risk tolerance can be a great way to develop a customized investment strategy that aligns with your financial objectives and takes into account your unique situation. By diversifying your portfolio and exploring a range of investment options, you can maximize your wealth and make your money work for you.

Avoid or Pay Off High-Interest Debt

Put simply, revolving high-interest debt is the archenemy of making your money work for you. It is the villain in your story, and it should be avoided as much as possible. If you have high-interest debt, such as credit card debt, paying it off should be your top priority. If left to accumulate, it can be incredibly challenging to make progress toward your financial goals, even for high-earners. Consider consolidating your debt or using the snowball or avalanche method to pay it off systematically.

Automate Your Finances

Automating your finances can be a powerful tool. Setting up automatic transfers from your checking account to your savings or retirement accounts allows you to consistently save and invest without even having to think about it. You can also automate bills to ensure you never miss a payment and avoid late fees. Automating your finances not only saves you time and effort but also helps you stay on track toward your financial goals. Just be sure to monitor your accounts regularly to keep everything running smoothly.

Utilize a Rewards Card & Pay it Off Each Month

This tip can be a great way to make your money work for you, but it should be used with caution and not as a way to live beyond your means. Many credit cards offer cash back, points, or miles for every dollar you spend, which can add up to significant rewards over time. Using these cards for everyday expenses you have to pay regardless can be a powerful way to make your money stretch further. 

It’s crucial to use this strategy responsibly and pay off the balance in full each month to avoid interest charges and debt. By paying off your balance each month, you can enjoy the benefits of a rewards credit card without incurring any additional costs. Compare different cards and their rewards programs to find one that fits your spending habits and financial goals.

Open a High-Yield Savings Account

One of the easiest ways to put your money to work is by putting it into a high-yield savings account. These accounts offer competitive interest rates and allow you to earn more on your liquid cash assets (like an emergency fund) without subjecting them to the volatility of the stock market. Start by comparing different banks and their interest rates, fees, and other features to find a high-yield savings account that suits your needs. While the interest earned on a savings account may not be as high as other investment options, it provides a low-risk way to earn passive income on your savings.

For high-net-worth individuals looking to earn more on their idle cash, there are other options that can improve your interest rate while still keeping your funds relatively safe. These include money market accounts, certificates of deposit, and short-term Treasury bills. No matter which option you choose, putting your idle cash to work is a great strategy for maximizing your wealth.

Take Advantage of Employer Matching Contributions

If your employer offers a retirement savings plan, such as a 401(k) or 403(b), don’t neglect to take advantage of any matching contributions. Employer matching contributions are essentially free money that can significantly boost your retirement savings. 

For example, your employer may offer a 50% match on the first 6% you contribute. If you earn $100,000 and contribute the full 6%, your employer will contribute an additional $3,000 to your retirement account. That’s an extra $3,000 toward your retirement that you didn’t have to earn or invest on your own! Be sure to contribute enough to your retirement account to maximize any employer-matching contributions, as it can make a big difference in the long run.

Give Back

Giving back to your community and supporting causes you believe in is an important way to use your wealth to make a positive impact on the world. It’s also a great way to make your money work for you through proactive tax planning. There are many ways you can give back, such as:

  • Establishing a charitable foundation: Setting up a charitable foundation can have significant tax benefits for high-net-worth individuals. Contributions to the foundation are tax-deductible and grow tax-free. Charitable foundations can also be used as an effective estate planning tool.
  • Donating to organizations: You can donate to a range of organizations that align with your values and mission. One popular way to do this is through a donor-advised fund (DAF). With a DAF, you can make a tax-deductible contribution to a fund, then recommend grants to your favorite charities over time. This allows you to receive an immediate tax benefit while still having flexibility and control over how your charitable dollars are distributed.
  • Qualified charitable distributions (QCDs): If you are over 70½ and have an individual retirement account (IRA), you can make QCDs directly to a charity of your choice. This allows you to satisfy your required minimum distributions while also making a charitable contribution that is excluded from your taxable income.

Invest in Real Estate

Investing in real estate is another way high-net-worth individuals can make the most of their wealth. Real estate investing can take many forms, such as buying and renting out a property, flipping houses, or investing in real estate investment trusts (REITs). Real estate can provide a passive way to grow your wealth through rental income or appreciation in value over time. It can also provide diversification to your portfolio by adding an asset class that is not highly correlated with the stock market. 

However, real estate investing can be complex and requires careful research and analysis. You must understand the local real estate market, the costs and risks involved, and have a solid investment strategy before taking on real estate, so this tip won’t work for everyone. Consider working with a financial advisor or real estate professional to help you make informed decisions.

Invest in Yourself

Lastly, consider investing in yourself as a way to make your money work for you. Whether it’s learning a new skill, taking a course, or pursuing further education, investing in yourself can improve your earning potential and help you achieve your financial goals. By continuously developing your skills and knowledge, you can become more valuable to employers or clients, increase your income, and build a stronger financial foundation for yourself. 

Additionally, investing in your health and well-being through exercise or nutrition can lead to long-term savings on healthcare costs and improve your overall quality of life. Be sure to prioritize investing in yourself as part of your overall financial plan.

Ready to Make Your Money Work for You?

Building wealth and making your money work for you may seem overwhelming, but with a comprehensive approach and the right mindset, it can be achieved through manageable steps. As a high-net-worth individual, it’s crucial to work with a team of advisors who understand your financial goals, risk tolerance, and unique situation. At Balboa Wealth Partners, we’re here to help. Give me a call at 949-445-1465 or email me at [email protected] to get started today. (Scottsdale office: 480-801-5100, [email protected])

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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SVB & Signature Bank Collapsed: Why Banks Fail & How to Protect Your Savings

By Jeff Gilbert

Banks play a vital role in the economy, providing individuals and businesses with access to cash, credit, and other financial services. Despite their importance, however, banks can fail. And when they do, the effects often cause panic in the wider economic environment. 

This past week, two major players in the banking industry, Silicon Valley Bank and Signature Bank, collapsed after they had trouble raising capital to meet the demand for deposits. While there are several reasons why experts believe these failures are not part of a more significant economic crisis, everyday investors are still understandably worried. These were the second and third largest bank failures in U.S. history, behind only the collapse of Washington Mutual in 2008.

Thankfully, there are safeguards in place that make it highly unlikely that clients will lose their entire life savings, even in the event of widespread banking failures. In this article, we explore why banks fail, what insurance protections are in place, and the safety of your savings.

Why Do Banks Fail?

Banks can fail for several reasons, including undercapitalization, liquidity issues, safety and soundness concerns, and fraud. 

  • Undercapitalization occurs when a bank has insufficient capital reserves to cover ordinary business expenses or meet regulatory requirements, which leaves it vulnerable to financial shocks. For instance, a bank that has issues generating cash flow or accessing financing in the form of debt or equity may find itself undercapitalized.
  • Liquidity issues arise when a bank lacks sufficient cash or liquid assets to meet its obligations, which can happen when a large number of depositors withdraw their funds all at once.
  • Safety and soundness concerns occur when a bank engages in risky lending practices, such as offering subprime loans or investing in volatile assets. This was a big issue during the 2008 financial crisis when several major banks failed due to their investments in subprime mortgages. 
  • Fraudulent activities, such as embezzlement or insider trading, can cause significant financial losses for a bank and erode depositor confidence. 

Banks that fail to manage these risks effectively may become insolvent and ultimately fail, jeopardizing the stability of the financial system and the broader economy.

What Happened With SVB & Signature?

SVB and Signature Bank both failed due to liquidity issues stemming from what’s known as a bank run. A bank run occurs when a large number of depositors withdraw their funds from a bank over a very short period of time (usually days). Because banks invest the cash deposited with them, a high demand for withdrawals can force the banks to sell off investments at a poor market price in order to meet the liquidity need. Consistently selling assets at a substantial loss can exacerbate liquidity issues and quickly cause a bank to become insolvent. 

Silicon Valley Bank almost exclusively served tech start-ups and venture capital-backed clients, which were particularly hard-hit during the economic volatility of 2022. As financing started to dry up for tech companies and venture capitalists couldn’t come up with additional funding, clients began withdrawing funds from their accounts at SVB to meet the operating expenses for their businesses. SVB was forced to sell billions of dollars’ worth of long-term Treasury bonds (initially bought when rates were near zero) at a massive loss to raise capital. This spooked other depositors, many of whom had accounts well above the FDIC-insured limits, and caused them to withdraw their money at an unsustainable rate. SVB could not meet their deposit requests and attempts to raise capital or sell the assets to a healthier bank were unsuccessful. The FDIC quickly stepped in as receiver and took over operations to prevent further damage.

A similar story unfolded at Signature Bank, which served mostly crypto investors. Similar to the depositors at SVB, many of the accounts held at Signature Bank were well above the FDIC-insured limits. Spooked by the failure of SVB, depositors at Signature Bank withdrew over $10 billion on Friday, March 10th. By Sunday, March 12th, the bank was taken over by the FDIC to protect the stability of the U.S. banking system.

What to Expect From Other Banks

While the effects of the SVB and Signature Bank failures are hard to predict, the FDIC has reacted swiftly to prevent further damage. Regulators have invoked a “systemic risk exception” which allows the government to reimburse uninsured depositors. The Fed has also set up an emergency lending program to provide funding to eligible banks at risk of bank runs. 

So far, small and midsize banks are at the most risk since they tend to focus on niche clientele who are more susceptible to industry-specific risks. Shares of regional bank stocks took a beating on Monday, March 13th, as investors tried to process the news of SVB and Signature Bank. First Republic Bank was down over 60%. Larger banks, including Wells Fargo, Bank of America, and JPMorgan were less affected, falling just 7%, 3%, and 1%, respectively.

What to Know About FDIC & SIPC Insurance

Despite the uncertainty surrounding the health of the overall banking system, there are safeguards in place to protect depositors and investors from losing their hard-earned savings.

Both the Federal Deposit Insurance Corporation (FDIC) and Securities Investor Protection Corporation (SIPC) provide insurance to preserve your assets. 

FDIC Insurance

The FDIC is an independent U.S. government agency that was established in 1933 to insure bank deposits. The FDIC insures deposits up to $250,000 per depositor, per account ownership category, per bank. This coverage includes checking accounts, savings accounts, money market accounts, and certificates of deposit (CDs) issued by FDIC-insured banks.

SIPC Insurance

SIPC is a non-profit organization established by Congress in 1970 to protect investors against losses due to broker-dealer failures. SIPC provides up to $500,000 in insurance per customer for cash and securities held by a broker-dealer. This coverage includes stocks, bonds, CDs, and mutual funds held in a brokerage account.

It’s important to note that SIPC insurance does not protect against losses due to market fluctuations, but only in the event of broker-dealer insolvency or fraud. SIPC insurance also does not cover investment losses incurred by the customer, nor does it cover non-securities such as commodity futures contracts or currency.

How to Safeguard Your Savings

Not all banks and broker-dealers are FDIC or SIPC insured, so be sure to double-check the status of your accounts and consider relocating your funds if your bank or brokerage is uninsured. Additionally, not all account types are eligible for FDIC insurance. Stocks, bonds, and mutual funds are account types that are not eligible for FDIC coverage, and commodity futures and currency contracts are not eligible for SIPC insurance.

Additionally, both FDIC and SIPC insurance have limits to their coverage. The FDIC insures up to $250,000 per depositor, per account ownership category, per bank, while SIPC insurance provides up to $500,000 in coverage per customer. Keep in mind that joint accounts are considered a separate ownership category, which means that each account holder is insured up to $250,000 under the FDIC program.

If you have accounts with multiple banks or broker-dealers, make sure your deposits and securities are spread out in a way that maximizes your insurance coverage. Remember to regularly review your account balances and adjust your accounts as necessary to ensure you are within the coverage limits. By knowing the coverage limits and eligibility requirements, you can make informed decisions when choosing where to deposit your money or invest your securities.

How We Can Help

If you’re worried about the recent bank failures and how they might impact your finances, don’t hesitate to reach out to us for guidance. Our team can help you understand your options and develop a plan to protect your assets, minimize your risk, and provide advice on FDIC and SIPC insurance. Give me a call at 949-445-1465 or email me at [email protected] to connect with a financial planner who can help you preserve your financial future.

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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Leave a Lasting Legacy: What Inheritance Are You Passing On to Your Kids?

By Jeff Gilbert

When we think about the legacy we want to leave for our children, it goes beyond just money. We want to make sure our gift to them provides stability for many years. We don’t want to pass on a jumble of assets, debts, and documents that can take a long time to untangle.

Passing wealth on to your children can be a difficult transition, and you want it to be as stress-free as possible. Estate planning can help keep your children from having to face the extra burden of navigating a complex inheritance process while also dealing with grief and making difficult decisions. Helping them experience a smooth and organized inheritance process can be a great gift.

The Importance of Estate Planning

Estate planning should be an integral part of your financial and retirement planning. Failing to have an estate plan may not have a significant impact on your own life, but it will undoubtedly affect the lives of your loved ones after you’re gone.

In the absence of an estate plan, your death will be considered intestate, which means there was no valid will in place at the time of your death. The state in which you lived will determine who inherits your property through a process called probate, which can take anywhere from 6-9 months or even several years without proper planning. 

In addition to this process lasting a long time, your inheritors may face expensive fees, predatory claimants, and loss of control over what happens to your estate. Probate can cost up to 3-7% of your total estate value. And because this process becomes public information, this means that greedy creditors or estranged relatives may attempt to claim portions of your wealth.

Good estate planning mitigates these risks and provides your family with a secure plan for how your wealth will be transferred. The professionals in your life, such as your estate planning attorney and financial advisor, can become trusted resources for your family to lean on during this difficult transition.

Create a Lasting Legacy

Additionally, good estate planning incorporates legacy planning, which can be even more beneficial to your inheritors. Legacy planning allows you to incorporate family or financial values into your wealth transfer. If your children aren’t as adept at money management or have made financial mistakes in the past, your legacy planning can help guide them through what to do with their new wealth. Finally, legacy planning may help to protect your grandchildren and encourage generational wealth-building for decades to come.

Set Your Heirs Up for Success

It’s important to consider what legacy you want to leave for your children. The last few years have shown us that the future can be unpredictable, so it’s wise to plan ahead. Even though we may not want to consider our own mortality, having a plan in place can bring some reassurance to our families.

Allow your family to benefit from your legacy by partnering with Balboa Wealth Partners. Our team is committed to helping clients make the most of their finances. We are dedicated to providing guidance and support that will empower you and your family to make financial decisions with clarity, peace, and confidence. Give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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5 Investment Trends to Watch in 2023

By Jeff Gilbert

With all the market volatility, rising interest rates, and persistent inflation we saw in 2022, many investors are wondering what they should expect from the markets in 2023 (and beyond). While we can’t predict exactly what will happen, we can share some investment trends that are gaining popularity as part of our collection of financial insights. 

Here are 5 investment trends to watch in 2023 so you don’t get caught unprepared.

Gold

Gold is one of the most traditional investment options out there, especially during times of volatility. Investors flock to gold in times of turmoil because it is seen as a safe haven from the equity markets. Gold also has typically had a negative performance correlation with stocks; as a result, investors see it as an excellent way to provide diversification protection to their portfolio. Gold has traditionally maintained its value over time and is a stable long-term investment. Investors also use gold to help protect their portfolios from the effects of inflation. 

Though gold did not perform as well as expected in 2022, it has a chance to rebound in 2023. Because the volatility of this past year is expected to continue throughout 2023 as many investors worry about a recession, gold could see renewed interest as an investment trend. 

ESG Investments

ESG investing has been gaining popularity over the last several years, and it looks like this trend will continue heading into 2023. ESG investing is a strategy that reviews the environmental, social, and governance practices of a specific company and assesses how those practices might impact the company’s performance in the stock market. ESG aims to examine the total ethical impact of an investment and align investors’ portfolios with their moral values.

It should be no surprise that ESG popularity is driven in large part by younger investors. In fact, nearly 8 in 10 millennial investors rank ESG investing as a top priority in their portfolios and 82% of Gen Z investors already have some exposure to ESG investments.

What’s more, ESG-related investments managed by advisors are projected to grow to $33.9 trillion through 2026, which would outpace the asset management industry as a whole. It’s clear that there is a growing demand for these investments as there has been a corresponding movement in recent years to look beyond just ourselves and consider the impact we’re making on the people and the world around us.

Renewable Energies

Similarly, renewable energy sources like solar, wind, and hydropower are growing investment trends to watch in 2023. As everything from fuel shortages, supply-chain disruptions, rising costs of fossil fuels, and a global climate crisis threatens the traditional ways we produce and consume energy, renewable energies will become essential in the future.

It’s estimated that climate change alone could reduce global economic output by as much as $23 trillion over the next 30 years. As the renewable energy sector continues to grow, this is a trend that investors can take advantage of through alternative-energy ETFs.

Recession-Resistant Industries

With continued rising interest rates and the persistent threat of inflation, there has been constant talk of a looming recession—so much so that according to an October 2022 Wall Street Journal survey, 63% of economists are now forecasting a recession and major job losses sometime in 2023, up from 49% in July.  

This suggests that recession-resistant industries will experience renewed growth in 2023 as investors prepare for the possibility of a sustained economic downturn. Sectors like healthcare, utilities, and consumer staples are typically defensive and do not react as much (or at all) to recession-related volatility. This is because demand for these products and services remain relatively consistent despite economic turmoil. 

Bonds

The overall bond performance in 2022 has not been great. In fact, it could go on record as one of the worst years in history in both the size of the losses (over 16% down) and the range (nearly all bond funds of every type have declined). But the outlook for bonds is improving and the asset class could make a rebound in 2023. For the first time in decades, bond yields are close to what you would expect from stocks. This means there is a potential to make more money in bonds in the upcoming year. 

The current market environment presents an interesting opportunity to buy bonds at significantly discounted prices. Despite the volatility, the outlook for bonds could be more optimistic in 2023. Bond yields and interest rates are up, while prices are down, making greater exposure to bonds an attractive option for many portfolios.

Talk Through These Trends With a Professional

Deciding what to invest in is never as easy as following the latest investment trends. Instead, you should discuss these (and other investment trends) with a skilled financial advisor who understands your unique needs and goals. At Balboa Wealth Partners, we specialize in serving high-net-worth and ultra-high-net-worth families as they navigate their complex planning needs. To get started, give me a call at 949-445-1465 or email me at [email protected]. Or complete a complimentary risk assessment here to learn more about your risk tolerance.

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.