Dear Financial Samurai,
Despite new tensions with Iran following U.S. bombings, a slight uptick in PCE, and signs of a weakening labor market for entry-level workers, the S&P 500 reached another all-time high. It’s been encouraging to hear about progress on the trade front with China, even though Friday’s canceled talks with Canada briefly shook market sentiment before the S&P 500 rebounded into the close.
Markets seem unfazed by the July 9 trade resolution deadline. Investors appear comfortable with moving targets, assuming delays will continue. Meanwhile, there’s growing anticipation of another Fed rate cut in September 2025. In other words, last week’s market call has been spot on.
To recap my thoughts post-bombing:
- Bonds rally first, driving down interest rates. The stock market may initially sell off due to uncertainty, but then recovers as yields decline and investors reposition for risk.
- Both stocks and bonds rally. Risk-on investors anticipate more fiscal spending, greater clarity now that war has been declared, and windfalls in defense and energy earnings. Meanwhile, risk-off investors still find comfort in relatively high guaranteed yields, supporting bonds.
Unfortunately, I didn’t fully execute on my convictions—because I didn’t wake up by 3:30 a.m. when the market opens here in Hawaii. This lapse is a reminder: those who wake up early are more productive and more likely to seize opportunities. If you’re not on nighttime childcare duty or working late shifts, try rising before the sun.
Read: Sleep In, Stay Broke: Wake Up Earlier For Financial Success
Want To Feel Over The Moon? Check Your Portfolio
Personally, I feel elated that we’re back at record highs. Go ahead and compare your portfolio balance from April 8 to today to get a nice joy boost. Even my dog-meat stock, Nike, found a little life after reporting earnings.
But remember: just as we shouldn’t get too discouraged when markets crash, we also shouldn’t get too euphoric when they rally. Discipline is always in order.
If you haven’t reviewed your portfolio in a while, now is a good time. With all the volatility, your asset allocation may have shifted significantly—even more than you realize. Tech exposure? Cash drag? I’ve found surprises in my own accounts more than once over the years.
Need A Portfolio Review? Empower Can Help
Although I’m taking a break from 1X1 consulting until August, Empower is offering free, no-obligation financial checkups for Financial Samurai readers with over $100,000 in investable assets (savings, taxable accounts, 401(k)s, or IRAs). Even if you’ve done this before and aren’t a current client, you still qualify.
Schedule your free Empower call here.
Here are three questions I’d ask if I were you:
- How does my portfolio balance and composition compare to peers with similar age, income, and household size?
- What stands out in my portfolio, and how can I optimize it?
- What’s my potential upside and downside risk with my current portfolio versus your recommendation?
I've used Empower's free tools since 2012 and spoken to their financial professionals in the past. It's always good to get another set of eyeballs to review your finances, especially from someone who reviews them for a living.
The statement is provided to you by Financial Samurai (“Promoter”) who has entered into a written referral agreement with Empower Advisory Group, LLC (“EAG”). Click here to learn more.
Managing Money Isn’t Easy
Since my kids were born in 2017 and 2019, I’ve occasionally thought about returning to full-time work if needed. One option I tested was managing investments for a relative. After a year, I realized: this isn’t for me. The emotional toll was unwelcome.
It also gave me a deeper appreciation for financial advisors and money managers. When markets are volatile, clients panic. Phones ring off the hook. Meanwhile, the advisor’s own portfolio may be suffering too. Yet, they have to remain calm and offer sound guidance under pressure.
The biggest lesson? Be careful about doing too much for free for family and friends. Set boundaries. Either help them learn to manage money on their own or guide them to a more sustainable solution. Otherwise, resentment and burnout may follow.
Read: Why I'll Never Manage Money For Anyone For Free Again
The Sun Has Risen
Alrighty folks, the sun is finally up here on the North Shore of Oahu, and it’s time to wrap up and tend to the kiddos.
I’m sleeping on a foldable couch in the living room while my wife and kids share the two bedrooms. The space is tight, and I feel like I’m back in college—but it’s fun. I can step out on the deck, breathe in the ocean air, and write in peace before the day begins.
In addition, we finally have our full freedom back after spending 13 days with my parents—whoo hoo! If you ever want to appreciate your independence, just go live with your parents or in-laws for a bit. It’ll snap your ungrateful self right back into shape. That’s partly why I do it!
To Your Financial Freedom,
Sam
If you were forwarded this newsletter, you can join 60,000+ readers by signing up here. You can also subscribe to my podcast on Apple or Spotify. My goal is to keep you informed on important financial topics and help you achieve financial freedom sooner rather than later. You only have one life to live—so you might as well get your finances right the first time.