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December 2023 Newsletter

December 2023 Newsletter – Reassurance: Relax and Enjoy the Holidays!

Uniquely Waterstone for our unique Waterstone clients 

In this Issue: 

  • Persistent economic perspective of angst
  • Big picture spending over time.
  • Measles Chart: ebb and flow
  • Overview of Social Security 2024
  • It’s the holidays – family and friends! Relax and enjoy!
  • Book idea to gift aviators, history buffs, the curious.

An economy is people spending money, creating earnings!

NY Times (11.22.23) – Consumer spending (blue)/Holiday spending (red T) since 1992.

Current polls indicate continued negative feelings about the economy.  Consumer behavior, however, is still on a spending roll.  There's a disconnect between thinking and action. However...

  • Jobs are still strong with signs of enough cooling per Fed rate goal.
  • Consumers are still holiday spending at a pre-pandemic healthy clip. (above).  The average holiday gift budget is estimated $985.
  • Earnings are still solid and in line with historic trends. 
  • The dollar is softening to allow for more balanced trade.  (Mexico: 15 pesos/$1 from a long stretch of 20p/$1. Tougher on tourists but better for US business.  It certainly isn’t stopping the tourists.  Flights and hotels are full!)

Thx to JPMorgan, Guide to the Market, Nov 23, pg. 15

The Measles Chart:  The grey bar and number is year end.  The red figure is the annual low point.

This is a reminder that the markets ebb and flow every year according to investor sentiments of fear and greed around risk and uncertainty.   Somewhere in the middle of the muddle are trends of expansion and contractions, shifts in innovation and development.

End of the year is time for forecasting.  Be reminded that this skill is a guess at trends interacting with unknown events and people’s reaction.

There is comfort in knowing our investment partners navigate on our behalf. 

Social Security Annual Adjustment:

The taxable wage base increases to $168,600, from $160,200 this year. 

The tax rate remains the same, 6.2% for Social Security paid by both the employee and employer. 

Maximum earners will pay $168,600 x .062, or $10,453.20. Self-employed individuals will pay both sides, or $20,906.40. 

The maximum social security to be received is $4,873/mo. (Maximum earnings credited over 40 qtrs – think CEOs.)

Clients who keep working into their 60s and 70s will continue to have their earnings reported. If earnings are at or near the wage base, their benefit will be adjusted upward, as these later earnings count for more than earlier earnings, even after indexing. 

The earnings test threshold rises to $22,320, or $1,860 per month, up from $21,240 or $1,770 per month this year

Next year’s 3.2% COLA, while above the 20-year average of 2.6%, isn’t grabbing as much attention as 8.7% COLA in 2023.

Book Idea:  This excellent book is a true story about two WWII aviators on each side of the war.  It’s intriguing insight into the development of planes by necessity, the risks, the aviators’ sense of duty in a world under the influence of a madman. It’s a gripping read for those who still have a sense of WWII.

Happy Holidays with family and friends!  

Note: Kathy will next be in the office December 5 to December 13. Cheers to Josh who is local, available and always appreciated.

Thanks if you've read to the end. You're our kind of people.
Reach out to us with your questions, comments, needs. 

Securities offered through American Portfolios Financial Services, Inc.(APFS) Member FINRA /SIPC. Investment Advisory Services offered through American Portfolios Advisors, Inc. (APA), an SEC Registered Investment Advisor. Waterstone Financial Services is not affiliated with APFS and APA. 

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