Retirement Plan Update, Q4 2025

Market Recap

The economy finished the year relatively strong amid mixed signals.  Consumer spending held up, supporting growth and consumer demand, while the labor market weakened with slower job gains and a modestly higher unemployment rate.  Inflation pressures remain a key concern as far as monetary policy decisions, but so far price increases have stayed in a narrow range slightly higher than the 2% target. The stock market finished 2025 strong, with the S&P 500 reaching record highs and delivering double-digit annual returns on the wave of optimism around earnings and AI investment.  At the same time, there continues to be valuation concerns and a high concentration in mega-cap Technology companies.  International equities also boosted returns in diversified portfolios.  The bond market delivered solid overall returns, with the aggregate bond index up around 7%, making it one of the stronger years for fixed income since 2020. Broad gains were supported by declining yields, helping bonds act as a stabilizing complement to the stock market.

Taking Control: A Practical Guide to Tackling Consumer Debt

Approaching the new year with a goal of becoming debt-free starts with clarity and intention: take inventory of all your outstanding debts, understand the interest rates you’re paying and minimum payments for each, and then create a focused repayment strategy.  It is generally smart to pay down the highest-interest debt first, or you can start with the smallest balance to build momentum.  But how do you get there?  It’s important to create a realistic budget that prioritizes debt payments while trimming discretionary expenses.  This doesn’t mean you can’t enjoy yourself; it means you should understand your priorities and spend where it matters to you while cutting out waste.  Another way to accelerate debt repayment is to direct any bonuses, tax refunds, or raises toward extra principal reduction.  This tax season, if you get a refund, commit to using that to pay off some debt!  Finally, make sure you also build small, sustainable habits while you’re paying down debt, such as avoiding new debt and building a modest emergency fund, so you can work toward long-term financial freedom.