This Week’s Good Financial News
According to the Census Burea, child poverty declined by 46% from 2020 to 2021. By one measure, which the Census Bureau calls the Supplemental Poverty Measure, or SPM, childhood poverty had declined to 5.2%. The SPM includes noncash benefits like SNAP, housing subsidies, and other tax benefits.
There is some noise in the below chart due to the expanded Child Tax Credit program that paid out in 2021 but was discontinued in 2022. However, look at the decline in child poverty since 2009. This is overwhelmingly good news for American families.
Notably, the SPM was estimated to be as high as 30% in the late 1960s. In 1993 it was measured at 27.9%. In other words, over the last 30 years, child poverty has declined by over 81%.
An Investment Note for Retirees
In our client meetings with retirees, we have consistently compared 2022 to the 1970s. Here is what happened in the early 70s:
The US dropped the gold standard - scary!
Watergate - yuck!
President Nixon resigned - insane!
The Oil Embargo - gas lines!
Inflation went from 3%→11% over two years - familiar!
...and more!
Yet, after dropping nearly 27% percent in 1974, US Large Cap stocks returned over 14% annually over the next five years. EVEN AS THE ECONOMIC NEWS STAYED BAD.
If you're feeling down about your portfolio, it's only because you don't know how the story ends.
Yet...
But guess what? Every bear market over the past 100 years has had a happy ending as long as you did this ONE thing.
Stay invested.
A Thought on Retire on Purpose
As you meditate on a purpose-filled retirement, ask yourself two questions:
How do my financial decisions reflect my core values?
How can my financial resources, present and future, help me move toward my envisioned life?