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IN THIS ISSUE: Market outlook, Trump accounts, and saving on holiday gifts |
GOOD START
How does an extra $4,200 sound? According to the US Census Bureau, that’s the median amount generated each year by households that bring in passive income. Here are 13 ideas if you’re interested. |
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THE HEADLINES
Rising rates, rising risk?What’s happening: Robust company earnings are helping keep the stock market strong, but investors are facing a new challenge: rising interest rates and borrowing costs partly due to inflation. That’s starting to affect not only stock valuations but also the broader economy. |
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Here’s why: When interest rates rise, companies have to pay more to borrow money for things like updating facilities and buying new equipment. If growth comfortably outpaces borrowing costs, debt may be easier to manage. But when borrowing costs rise relative to growth, the math becomes more difficult.
Jurrien Timmer, Director of Global Macro at Fidelity, says the economy may be reaching a similar point, where the inflation-adjusted cost of borrowing has risen above the economy’s estimated long-term growth rate. Over time, that could weigh on borrowing, business investment, and economic growth, while putting additional pressure on heavily indebted companies.
What it means: The bull market may still have room to run, but investors may want to set realistic expectations for the kinds of returns the next chapter may bring. Rather than reaching for more risk, Timmer believes this may be a time to rebalance. That could mean looking beyond the largest US technology companies and considering global markets and parts of the US market that are less dependent on AI.
Not sure where to start? Here’s how to rebalance your portfolio in 4 steps. Want someone to walk you through it? At Fidelity, you may be able to work directly with a licensed financial representative.
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En(roll) with itWhat happened: The US Treasury auto-enrolled over 65 million eligible children under 18 for a Trump Account.1 Previously, families had to opt in to open a Trump Account.
Here’s why: The government says they want to help give kids a head start on saving for the future in what’s essentially a custodial individual retirement account (IRA). |
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What it means for you: An account was created for your child if they have a Social Security number. Families still need to claim the accounts to make individual contributions and receive employer contributions. In addition, families with children born in 2025 and 2026 (and later, those with children born in 2027 and 2028) will also have to claim the $1,000 government seed money separately to accept it in the now-claimed account.
Here’s how to open and claim a Trump Account and sign up for updates, including being notified when you can transfer the account to Fidelity. |
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No time like the presentWhat’s happening: Holiday shopping is starting early this year, with October spending at Black Friday levels, according to Adobe’s 2026 US Holiday Forecast.
Here’s why: Rising inflation and tight budgets are encouraging shoppers to spread purchases over a few months.
What it means for you: Almost half of shoppers plan to borrow money to pay for gifts and think holiday costs will push back debt repayment, saving, or retirement contributions.2 To avoid being part of that statistic, you could start holiday shopping now. Deals are already showing up, giving you more time to compare prices, save up across multiple paychecks, and avoid a last-minute spending crunch.
Here are 12 ways to set a budget and save on gifts. |
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FEATURE
Possible Social Security benefits changesIf Congress doesn’t take action, recipients could face a 22% cut in benefits.3 But policymakers are considering a few approaches to address the issue. |
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MONEY TREND
Sharing your debt on social mediaWhat it is: A growing number of people are turning their debt repayment efforts into public diaries, sharing balances, victories, and setbacks with others. In the 12 months through September, more than 28,000 debt-related videos were uploaded to 1 social media platform.4
Why it’s trending: Being transparent about a typically taboo topic draws in views. These videos give viewers a chance to compare other people’s financial decisions with their own and see how they measure up.
Feeling inspired? You don’t have to reveal all to make a dent in your debt. Pay it down with 1 of these 2 tested debt-deleting methods. |
