Dear Plenty Community,

There’s a magic to the rule of threes: researchers have found that repeating a habit three times dramatically increases the chance that the habit sticks. So if there are new things you’re thinking of trying, kick it off with a plan to do it 3 times over.

At Plenty, we’re here to help you both enjoy the journey. In an era where dual-career households are the new normal, we’ve built a wealth management platform specifically for the needs of the modern couple. In 2024, we have some exciting product launches in store to support you more this year. So here’s to a year - of reaching goals and new milestones.

Cheers,

Emily

One of our key predictions for the year is the resurgence of the real estate market.

The Federal Reserve has implemented 11 rate hikes since 1Q2022, homebuyers then took a break, resulting in a notable drop in home sales volume. With inflation significantly down from its mid-2022 peak of 9.1%, the Fed is expected to make multiple rate cuts in 2024.

In alignment with this, we anticipate the Fed to decrease the Fed Funds rate at least three times by 25 basis points each, bringing the year-end target down to 4.5% - 4.75% from the current 5.25% - 5.5%.

Even with inflation at 3%, the Fed Funds rate would still be restrictive by 1.5% - 1.75% after the cuts (i.e. 4.5% - 4.75% is still 1.5% - 1.75% above a 3% inflation rate, which helps slow down the economy). The Fed is cautious about falling too far behind the curve in cutting rates, as it could lead to a recession with significant layoffs.

We project the average 30-year fixed-rate mortgage to drop below 6%, down from its 2023 peak of around 8%, influenced by both Fed rate cuts and the narrowing spread between the 10-year bond yield and the average 30-year fixed rate. Historically, the spread (aka difference) between the two has been under 2%, compared to ~2.65% today.

While the S&P 500 delivered a 24% return in 2023, real estate performance has lagged, ranging between 20% - 28%, depending on the home price index followed (e.g., St. Louis Fed, Freddie Mac Home Price Index). We expect capital to flow into the real estate sector as portfolio managers rebalance their portfolios and for potential gains from a recovery

With pent-up demand building, bidding wars and a median home price appreciation of 4%+ are possible, compared to the consensus of approximately +1.8%.

Considering our prediction, if you're contemplating the purchase of a new home, doing so earlier in the year might be advantageous to beat the crowds. Once mortgage rates drop by another 1% or more, home prices could have already experienced a significant increase.

For context, below are the various 2024 home price predictions from some of the largest industry players.

10 Money Resolutions For Millennial Couples

One of our favorite couples' resolutions is embracing the magic of a money date night. Money, but make it fun. Dive into Yelp's treasure trove and unearth the best hidden gem – a bar or restaurant that's been elusive to your taste buds. Or maybe, open a bottle of wine, light some candles, put some fun tunes on, then pull up your laptop. Skip the hours of manual spreadsheets, logins, and receipts, and jump straight to where you are and what you’re on track for, with Plenty. As you savor each sip of your favorite cocktail, weave a tapestry of your financial and life goals

Perhaps one of you is harboring dreams of grad school or eyeing a switch to a more thrilling career. Dive into the details and create a plan. With a solid financial game plan, taking that leap becomes not just a dream but an achievable reality. And if it’s not the right goal, there are plenty of other dreams you can use the money for instead. Win-win.

Let's face it – one of the sneakiest culprits of fighting in relationships are unspoken expectations. The more you open up the channels of communication, the more symphonic and harmonious your journey together becomes.

Buying Your First Home: What You Need To Know

Embarking on the journey of buying your first home is a thrilling yet daunting experience, made even more challenging by the surge in home prices since the onset of the pandemic in 2020.

The St. Louis Federal Reserve estimates that ~ 66% of Americans are proud homeowners. This statistic underscores the significant protection real estate enjoys as an investment, with the government consistently dangling incentives to encourage home purchases and promote long-term residency.

In our article, we share tips on how to get your finances in order, the importance of getting pre-approved, and more. Over the course of the year, we’ll write more about home-buying tips and home-buying guides to consider. Stay tuned.

Plenty is a wealth platform helping modern couples invest and plan for their future together. We bring the investment strategies and products of the wealthy to the everyday household. For more information, visit withplenty.com. If you ever have any feedback or questions, please do reach out to us at [email protected].

At Plenty, no financial topic is off-limits for modern couples. We offer straight talk and judgment-free guidance to help modern couples navigate the tricky and important intersection of money and relationships. Join thousands of couples who’ve signed up for our free newsletter today.

Plenty Financial RIA, LLC is an SEC-Registered Investment Advisor. All investments made are legally owned by you. Investing is inherently risky and Plenty does not guarantee positive performance. Investments are held in accounts at BNY Mellon | Pershings, the world’s largest securities servicing company and are SIPC insured. Investing involves risk, including the possible loss of principal, and there is no assurance that the investment will provide positive performance over any period of time. Please see Plenty Financial’s general disclosures. Brokerage services are provided by Atomic Brokerage LLC "Atomic Brokerage", member FINRA and SIPC. Clearing and custody services are provided by Brokerage firm BNY Mellon Pershing, member SIPC. Plenty Financial RIA, LLC has a relationship with Atomic Brokerage to manage and execute investments on behalf of customers. Subadvisory services are offered through Atomic Invest LLC ("Atomic Invest"), an SEC-registered investment advisor, member SIPC. Atomic Invest was formerly known as Helium Advisors LLC. Registration as an investment adviser does not imply a particular level of skill or training.