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Donna Cournoyer

2024-2025 FAFSA FORM – Continuing Issues and Delays

This 2024-2025 college application year is one for the books…

We (schools, parents and especially students) have endured delay after delay for the newly overhauled FAFSA- the Federal form for applying for financial aid, which the government uses to determine student eligibility for financial aid and schools also use to determine how they will award their own funds.

The most recent delay coming this week when the Department of Education announced, the day before the ISIRS (Institutional Student Information Records) were supposed to start arriving at schools, that they were in fact, not going to start arriving at schools until “the first half of March”. This means that for anyone who completed a FAFSA, schools are not going to have those records to start reviewing until at least mid-March. This cuts the time even more and SIGNICANTLY for financial aid offices, who will need to scramble to review the FAFSA forms and try to get their financial aid offer letters out to freshman applicants in time to decide on where to go to college by May 1. A decision which for many families, depends in large part on how much it will cost the family out of their pocket after any merit scholarships and financial aid. Families will be receiving these letters months later than usual this year.

Some of the issues are also that some students and parents are having difficulty accessing and signing the form. Due to the processing delays, there is also the issue of not being able to correct the form until the records are processed and are sent to the schools. So, if you know you have made a mistake, you cannot correct it for another few weeks at least.

First, for freshmen applying to college for fall of 2024, this creates an extra layer of uncertainty and stress, estimating that they will not know how much aid they will receive and how much they will need to pay to attend the schools on their list until likely past April 1. For their parents, even greater stress.

Second, for students returning to college, they need to know if their aid package will change, based on the overhaul in the Department of Education’s formula on the brand new FAFSA this year. For example, the loss of the “sibling discount” for families having more than one child in college at the same time.

Ways You Can Take Advantage of the Extra Time:

  • Apply for private scholarships. This is the time they are open. Search locally, with your high school guidance office and qualified search sites. See my links
  • Consider appealing for more merit scholarship money. If you have offers from competing schools, or if you know your school offers higher merit scholarships, you may have a good chance at an appeal. Schools still need to secure enrollment for their fall class of students during these delays, and if there is a chance for an applicant to deposit early, they may have incentive to increase the offer.
  • If you have extenuating circumstances, don’t wait to reach out to the financial aid offices. If you have had situation over the past year that may have affected your finances, such as a job loss, you will want to reach out the financial aid offices to ask about their process for appeals if it is not clear on their website, so that you can be prepared to send documentation when they are ready to receive it.
  • Do some assessment of your financial plan to pay for college. Although you may not have the net cost confirmed for any of your schools. Start planning for what resources you will be using to cover out of pocket costs for college over the next 4 years and make a list. Will you be using a 529? Savings? Making payments monthly to the school? Borrowing? Or a combination of the above? Start planning out what you have for resources so that when you begin getting final offers from the schools, you will know how your finances match up.

Check the websites for your school list:

Decision Dates: Some schools have or are considering changing their decision date of May 1 this year due to the FAFSA delays.

Be sure to check all the websites for the schools on your list to see if they have extended their May 1 decision to commit date.

Financial Aid process: Some schools may have created their own preliminary financial aid form due to the Department of Education delay of the FAFSA. Also, schools that use the CSS Profile (between 250-300 schools) may be sending out offers ahead of receiving the FAFSA records for applicants, due to the fact that the CSS Profile form has not changed and opened in October.

Be sure to check the financial aid pages of your school websites to see if your schools have created and require new forms or are using the CSS Profile due to the FAFSA delays.

The bottom line is that the 2020 Congressional laws passed that required significant changes to the FAFSA form with the intention of making more students eligible for aid and the form completion easier has created a lot of anxiety and uncertainty for college students and families for the 2024-2025 year as the rollout has been anything but smooth.

In light of these delays of information – essentially knowing the cost you will pay out of pocket for each school on your list – which is crucial for most families in order to decide on college, some families may decide not to apply for financial aid, thus leaving money on the table and spending more out of their pockets next year. Some schools require the FAFSA form to award their merit scholarships and/or some free grant money that is sometimes even offered to those applicants who are not eligible for need-based financial aid by the FAFSA form, in order to entice students to commit.

Of course, as in my previous articles, my advice is to weather the storm, and do the form and be more vigilant than ever staying on top of deadlines and information gathering in this last sprint in your college decision. It will be worth it in the end.

 

Measuring Your Life

For people accustomed to relying on intuition and ‘trusting their gut’, the question How Will You Measure Your Life? might seem strange. Is it possible to measure one’s life? If it is, how would one approach the task? And anyway, is life worth measuring?

On the other hand, for quantitatively oriented individuals, the idea of not measuring everything that can be measured may seem odd. Measuring provides information, information allows for analysis, and analysis enables optimization. Who doesn’t want to lead an optimized life?

Innovation expert Clayton M. Christensen spent his life studying businesses and how people behave in business settings. He was troubled by his observation that people with great potential (his Harvard Business School classmates, for example) often made choices that resulted in disharmony and unhappiness in their personal lives.

In How Will You Measure Your Life?, Christensen refrains from recommending that we measure everything in our lives that can be measured.

Rather, he suggests that we can use theories which have been rigorously examined and used in organizations all over the globe to help us with decisions that we must make as individuals.

The book seeks to answer the question: “How can I find happiness in my career?” But it gets at deeper issues, guiding us to consider what it means to lead a fulfilling life, and offering frameworks for helping the reader find fulfillment.

New Year, New FAFSA

After Congress approved some major changes to the Free Application for Federal Student Aid (FAFSA) a few years ago, the US Department of Education has taken years to fully implement the changes and overhaul the FAFSA form.

The target date for release of the new form, October 1, 2023, was missed.

The Department of Education then announced a “soft launch” by December 31, meaning that the form would be open by December 31 at the latest (it opened that day for two hours), but also be intermittently closed from time to time for review and maintenance.

These fits and starts have caused students, families, and financial aid offices to play the waiting game and adjust their financial aid timelines.

New York Times columnist Ron Lieber’s article I Spent New Year’s Eve Trying to Do the FAFSA. It Didn’t Go Well, published on January 1, summed up some of the frustrations experienced by families trying to complete the FAFSA form when it opened at the end of December.

Many of the kinks, as of mid-January, now seem to have been worked out.

While families should complete the form as soon as they can, they should not worry about getting it done immediately.

The US Department of Education has indicated that it will not be sending the information to schools until the end of January at the earliest. So, it may be best to wait a week or so more to ensure a clear path to completion.

Noted Changes to the New 2024-2025 FAFSA Form:

  • Form length. The new FAFSA form is considerable shorter. The form has been reduced from 108 questions to about 46, or less, depending on your situation.
  • The custodial parent is now who contributed the most financially for the student. For divorced families, the parent required to complete the FAFSA used to be whomever the student lived with the most in the previous year. It is now whomever contributes the most financially.
  • Pretax Contributions to a retirement account (from W-2 box 12) is no longer required for untaxed income. See form for exceptions such as SEP.
  • If a parent owns a business, it must be disclosed on the form. Previously, if a parent owned a business but there were under 100 employees, they were not required to list the business value on the form. Now ALL parent-owned businesses must be listed. You should list the value after any debt.
  • 529 Accounts. Previously all parent-owned 529 accounts for any children had to be included in the investments section. Now only a 529 for the student on the application must be listed. 529s in grandparent’s or relative’s names are NOT included.
  • Students and parents are now required to give “Consent” which must be given for the Direct Data Exchange (previously called the IRS Data Retrieval). For the FAFSA to be processed, the student and parent must give “consent” which will automatically populate income information, except for a few situations.
  • Students and parents are now called “Contributors”. This does NOT mean they are required to contribute financially. The student must “invite” the parent to be a contributor.
  • EFC (Estimated Family Contribution) is now called the SAI (Student Aid Index). This is the number created by the formula to determine a student’s eligibility, based on the information on their FAFSA application which the government and schools use to award need-based aid.
  • The number of students in college is still listed on the form but is no longer considered in the eligibility calculation. If the student will have one or more siblings in college at the same time for the coming year, or has in past years, this will no longer lower the student’s SAI. The result for parents is that having more than one dependent in college at the same time does not necessarily translate to more need-based financial aid. For current students in this situation, talk to your financial aid counselor for information on how this may affect your aid.
  • Maximum number of schools you can list on the form. The previous FAFSA limited applicants to 10 schools. You may now list up to 20 schools to receive your FAFSA form.

My recommendation is for every student to complete the FAFSA form, especially in year one.

Some schools award non-need-based grants and merit scholarships only to students who complete the form. Also, this is the only way to take advantage of using the Federal Student Loans if you intend to do any borrowing for college.

To complete the 2024-2025 FAFSA form, go to https://studentaid.gov/h/apply-for-aid/fafsa and click on the link “Start New Form.”

After completing the FAFSA form, watch for an email from the US Department of Education with the “FAFSA Submission Summary” (previously called the Student Aid Report) which has information about your FAFSA application.

Also, watch for school communications from colleges your student has been admitted to and to whom they have sent the FAFSA. Schools will begin sending out financial aid offer letters once they start receiving and processing the FAFSA forms from the Department of Education. If you have any questions regarding these offers, contact the financial aid office at the school. Timelines at each school will vary, especially with this year’s delays.

If you would like information on how we can help your personal situation with our college planning service, please sign up for a free 30-minute consultation on our website.

For additional FAFSA and college planning please see our College Planning articles on our website Blog.

New Tax Rules for 2024

The laws that stipulate how we must handle our personal tax situation are complex and dynamic. Changes can be built into existing statutes and shifting government priorities can also lead to adjustments to the rules.

For example, SECURE 2.0, the 2022 law designed to bolster retirement savings, has over 90 provisions with different effective dates.

Staying on top of what’s new in tax, and making the most of the changes, is an important part of the financial picture for most individuals.

Below are ten key changes in tax law for 2024:

  1. Standard Deductions: Married couples get $29,200 plus $1,550 for each spouse 65 or older. Singles can claim $14,600, or $16,550 if age 65 or older.
  2. Income Tax Brackets: Income tax rates are unchanged, but the tax brackets have widened out. For example, in 2023, income from $0 – $22,000 was federally taxed at 10%, and income from $22,001 – $89,450 was taxed at 12%. For 2024, the upper bound of the 10% bracket shifts to $23,200, and the 12% range adjusted to $23,201 – $94,300.
  3. Capital Gains Tax: Tax rates on long-term capital gains and qualified dividends do not change, but income thresholds to qualify for the various rates go up. For example, the 0% rate for capital gains applies at taxable incomes up to $94,050 for joint filers and $47,025 for singles.
  4. Payroll Taxes: The Social Security annual wage base for 2024 is $168,600, which is an $8,400 hike. The Social Security tax rate on employers and employees remains 6.2%, and both pay the 1.45% Medicare tax on all compensation, with no cap.
  5. 401(k): the maximum contribution is $23,000. People born after 1975 can contribute an extra $7,500.
  6. IRA & Roth Contributions: the contribution cap for IRA and Roth accounts is $7,000 for those up to age 49. If you are age 50 older, the cap is $8,000.
  7. Roth IRA Ceilings: Contributions phase out with Adjusted Gross Income (AGI) of $230,000 to $240,000 for couples and $146,000 to $161,000 for singles.
  8. IRA Deduction Phaseouts: Couples covered by 401(k)s begin to lose a portion of the tax deduction benefit at $123,000 of AGI and lose it completely at $143,000. For singles, the range is $77,000 – $87,000. If only one spouse is covered by a plan, the phaseout range for deducting pay-ins for the uncovered spouse is $230,000 – $240,000.
  9. QCDs:The Qualified Charitable Distribution cap is indexed to inflation, so IRA owners 70 1/2 and older can transfer up to $105,000 in 2024 from their IRAs directly to charity without having to pay tax on the withdrawal.
  10. 529s: Funds in 529 education accounts can be rolled over tax-free to a Roth IRA. There is a $35,000 lifetime cap and the 529 must be open for more than 15 years.

The New, New Thing: A Bitcoin Story

In 1999, author Michael Lewis published The New New Thing: A Silicon Valley Story, about Jim Clark, a technology entrepreneur who helped launch the age of the internet. Also in that year, technology stocks (as measured by the Nasdaq index) rose by 86%. The following year, as the internet bubble burst, the Nasdaq plummeted by 77%

Since its launch in 2009, the cumulative price increase of Bitcoin has been astounding: a mere $100 purchase of Bitcoin in 2010 would be worth millions today.

But the year-to-year return from holding Bitcoin during the past half decade has been noteworthy due to wild price swings, more akin to the tech stock experience of the late 1990s – early 2000s. In the crypto crash of 2022, the Bitcoin price declined by 65%. More recently, the price has climbed by a similar amount.

Until this year, owning Bitcoin has been more challenging than buying stocks or bonds. Typically, Bitcoin aficionados needed to do things like create a digital wallet or open an account on a specialty crypto exchange to hold their coin.

The “New, New Thing” in 2024 is that Bitcoin can now be bought and held in a standard brokerage account or IRA, just like a run of the mill stock, bond, or mutual fund.

On January 10, the US Securities and Exchange Commission (SEC) authorized eleven applications to offer exchange-traded funds (ETFs) tied to Bitcoin.

Since the question of “can I buy it?” has been answered with the advent of Bitcoin ETFs, more investors may now be asking “should I buy it?”

We encourage our clients to think long-term and prioritize well-diversified portfolios that support their financial plans. It’s not a crazy notion to think that an allocation to Bitcoin would add to the diversity of a portfolio and might contribute to wealth creation over time.

Some market practitioners equate Bitcoin to “digital gold”. Actual gold has been recognized as a store of value for centuries due to its durability, fungibility, and scarcity. While fourteen years probably falls short of a true durability test, Bitcoin does check the boxes of fungibility and scarcity, so the digital gold claim is not without merit.

Other folks are turned off by the idea of Bitcoin because of its association with illicit transactions. Since it is possible to hold actual Bitcoin in a wallet that is delinked from an exchange and not hooked up to the internet, cryptocurrency is a favored medium of exchange for malefactors.

The question of “Should I buy it?” is best considered through a lens of personal values and preference. A more appropriate question for an advisor to answer is “Must I buy it?”

For most individual investors, some mix of stocks or stock funds; bonds or bond funds; and short-term investments are appropriate and required to meet long-term financial goals. Stocks, bonds, and short-term investments are the must-haves in a typical investment portfolio.

Stocks provide an important growth element. A stock’s price is influenced by the profitability and sustainability of the enterprise that issues it. Over the long-term, there is a high likelihood that a diversified stock allocation will exceed the rate of inflation and enable the holder to maintain or improve their purchasing power.

Bonds and bond funds deliver regular income and often act as an offset when stock prices stumble. Bonds are contractual arrangements that promise their holders income and return of principal. Short-term investment funds also include contractual arrangements and typically provide stability with modest returns.

Commodities, on the other hand, are not tied to profitability of an entity, nor are they contractual arrangements that promise a return. Commodities are economic goods with fungibility whose prices are influenced primarily by supply and demand and are often the subject of speculative activity.

As such, we typically don’t include commodities directly as elements of investment portfolios for our clients: no gold ETFs, no oil ETFs, no funds whose sole purpose is to have direct exposure commodities. Since I view it as a commodity, Bitcoin is not a portfolio “must have”.

Another twist on the cryptocurrency narrative is its treatment under the law. The Commodity Futures Trading Commission treats cryptocurrencies as a commodity; the SEC argues that certain cryptocurrencies should be considered securities; and the Internal Revenue Service treats crypto as property.

While the latest Bitcoin ETFs won’t be popping up as a constituent in our model portfolios any time soon, you should know that digital assets are being viewed very seriously as investment vehicles by many large institutional investors.

Also, cryptocurrencies offer interesting technological applications that are being explored by financial institutions and even by central banks.

At a minimum, it’s worthwhile for informed investors to have some perspective on developments in the digital asset space. If you have questions, please send them our way.

Polls, Politics, and the 2024 Election

The race to win the White House in November 2024 is now in full gear. For anyone who’s accustomed to reading the news, watching TV, or engaging with social media platforms, the font of information on this topic will overflow as we approach November.

At this point, the Presidential election seems to be headed toward a 2020 rematch. The outcome likely will be consequential in many areas, including for the tax and investment environment for individuals and businesses.

Recently, I had the opportunity to participate in a conference call hosted by Goldman Sachs, which featured a leader in the bank’s Office of Government Affairs.

Key takeaways on the current political situation ahead of the November elections:

  • The race for the Republican nomination will continue if Nikki Haley wins a plurality of the votes in the New Hampshire primary on 1/23; otherwise the race is “pretty much over”
  • In a Biden-Trump rematch, the third-party element is important; currently Robert F. Kennedy Jr, Jill Stein, and Cornell West cumulatively are polling in the mid-teens to low-twenties in the percentage of the popular vote
  • Third party candidate support tends to pivot toward the established candidates as election day approaches
  • In 2016, third-party candidates accounted for 3-6% of voters in battleground states; in 2020, support for third-party candidates collapsed to about 1.5% of the vote in battleground states
  • Third-party voters who pivot have tended to favor Democrats, so if third-party support stays strong, Republicans will likely be the beneficiaries
  • In the electoral college, Biden will start with 226 “highly likely” votes and Trump with 219, with 270 required to take office
  • There are seven states in the “up for grabs” category: Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania, and Wisconsin
  • In 2016, Trump won all seven of these swing states
  • In 2020, Biden won 6 of the 7, losing only in North Carolina
  • States which had the tightest margins in 2020 were Arizona, Georgia, and Wisconsin, where the cumulative margin of victory was 44,000 votes
  • The House of Representatives is down to a 2-seat Republican majority due to recent departures
  • Congressional districts are being redrawn in some areas as a result of court challenges from 2020-21, which will likely favor Democrats
  • Three Senate seats in “super-red territory” are coming up for re-election which are currently held by Democrats: in Montana, Ohio, and West Virginia
  • It seems possible that Democrats could win a majority of seats in the House, and probable that Republicans will win a majority of seats in the Senate
  • With a Trump victory, a sweep of the House and Senate is possible, which would put Republicans in control of both houses of Congress and the Presidency
  • With a Biden victory, divided government is the likely outcome
  • Presidential election years typically correspond with weaker stock market returns

New Year, New Narrative

At the start of 2023, a hot topic among the Wise People of Wall Street was not if, but when, the US economy would slide into recession. Some prognosticators were calling for another precipitous drop in stocks, too, after an 18% decline in 2022.

As often is the case, reality differed significantly from projections.

With the turn of the calendar to 2024, there’s a whole new narrative by the smart-set forecasters. Today’s commonly held views about the US economy and financial markets are:

  • Jobs market will weaken
  • Economy will stall but not fall into recession
  • Inflation will continue to decline
  • Federal Reserve will start bringing down interest rates
  • Financial market returns will be about average: in the neighborhood of 8% for stocks and 4% for bonds

I think this is all quite reasonable. It’s helpful to begin a year by setting expectations, and the ones listed above are modest and fall well within the realm of possibility. But no one really knows what shape the economy, or the financial markets, will be in a year from today.

When writing to his clients during the financial crisis of 2008, Howard Marks, the Los Angeles-based money manager, shared his favorite quote from the esteemed economist John Kenneth Galbraith: “There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know.”

As a financial advisor, it’s good to keep this in mind. It’s also important to draw from past experiences and seek to understand what’s going on in the current environment, to provide the best possible guidance to clients on what is likely to happen in the long term.

Below, I’ve presented a table of returns related to Stocks, Bonds, and Cash, which are the main building blocks for many client portfolios.

The recent experience of returns from stocks and bonds differs from what you might expect to receive as an investor with a long time horizon.

(Source: Morningstar; Aswath Damodaran; *JP Morgan Asset Management)

You’ll also notice that projected returns for the Next 10 Years* (last column, blue font), from JP Morgan’s extensive Long Term Capital Markets Assumptions study, are moderate and more in line with the long-term historical experience (25 Years) than returns realized in more recent years.

While these statistics are informative, a picture can often provide additional clarity. The graph below presents another view of the long-term return experience for stocks, courtesy of Capital Group.

(Source: Capital Group; Stock index depicted is MSCI All Country World Index)

The picture catalogues many scary (and some tragic) events that have happened during the past thirty-five years, superimposed on the value of a standard global stock market index.

If you narrow your vision to a particular segment of the graph, you’ll see the stock index line swinging up and down, with many unfavorable outcomes in shorter periods corresponding to unfavorable events. Over the short-term, buying stocks seems to be a hit-or-miss activity.

But if you widen your vision to take in the whole graph, you’ll see episodes of volatility as part of a long-term, upward sloping, positive trend. If you decide to own stocks for the long-term, the odds of a positive result move decidedly in your favor.

There likely will be surprises in 2024, and we can imagine that some of the potential outcomes might translate to unfavorable results for your portfolio. It’s advisable to be prepared for downside scenarios.

But I also recommend that you ready yourself for a ho-hum year of pedestrian returns, as well as another year of terrific performance. By taking this approach, you’re mentally prepared for whatever unfolds in the year ahead.

Investors should focus on staying invested and diversified rather than reacting to surprises that come out of left field. Sticking to a financial plan that is designed around long-term goals, and a portfolio that supports the realization of those goals, remains the best way to achieve financial success.

December 2023 Market Recap: Old Year Wrap Up

Political polarization, bank failures, recession concerns, terrorist activity and global military conflicts were all troubling issues that weighed on the minds of investors last year. However, financial markets showed resilience, stock markets climbed, and for many investors, portfolio returns turned out to be satisfactory in 2023.

A group of technology-focused companies, commonly referred to as the Magnificent Seven – Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla – had an extraordinary year, with each stock returning 49% or more. “Mag 7” returns comprised the bulk of the S&P 500 Index’s full year gain of 26%.

To put some perspective around the scale of these companies, the combined market value of the Mag 7 at the end of 2023 was greater than any other single country’s stock market.

Bond returns were less ebullient, but still positive – breaking the trend of two consecutive years of negative returns in 2021 and 2022. The Bloomberg Aggregate Bond Index, a benchmark for bond performance, returned 5.7% in 2023.

Behind the positive bond performance at year-end, there were wild swings in prices and yields throughout the year.

Market participants’ opinions on the likely path of inflation and concerns about how the Federal Reserve might respond with adjustments in short-term interest rate policy were factors behind the bond price swings.

Despite the intra-year volatility, the yield on the 10-Year Treasury note finished 2023 exactly where it started, at 3.88%. Short-term Treasury yields closed the year much higher, though, reflecting the inflation-fighting activity from the Federal Reserve, which included multiple increases in short-term interest rates.

Below is a snapshot of stock and bond returns by quarter for 2023.

Holiday Break- Great Time to Discuss College Expectations

After the much needed and joyful celebrations with families and friends coming up this month, the holiday break for students is a great time to have a family discussion on college.

Often parents have a slightly less hectic schedule as well, and you can come together to have some meaningful discussions so that you are all on the same page when the college action list ramps up this summer.

Students- this is a great time to engage your parents in your college search and let them know how they can help you.

Parents- this is a great time to learn what your student would like to study and achieve with their college education and experience.

Items to consider:

  • Start your research and college list– Look for a school that fits your major, size of school you’d like to be at, and that falls within your requirements and geographical areas you want to be in.
  • Make a Test Prep Plan-Consider which tests you will take (ACT, SAT) and decide if you will take prep courses and map out deadlines to register.
  • Continue to Get Involved in Areas of Interest and Consider Volunteering or Working in them– Look in areas that interest you and that you are passionate about so that it is genuine when you list these on your applications next fall.
  • Check Open House Schedules for Potential Colleges– There are many open houses in spring. Schedule visits with the schools you are seriously considering and plan any travel.
  • Meet With Your High School Counselor– Meet with your counselor and see what help they have available to you. Get engaged and let them know what your goals are for college.
  • Set Up or Plan Your Senior Class Schedule– Review possible courses with your counselor. For example, will you take AP classes? Continue to challenge yourself.
  • Make a List of Teachers and Mentors– List anyone whom you may want to ask for letters of recommendation during your application process next fall. Have a conversation with them to let them know.
  • Start Working on Your College Essay– It is never too early to start, and you will likely have many iterations of your essay before you complete applications.

Finally, start a conversation together about finances.

Parents may want to set expectations for what kind of financial support they can provide and what they expect from the student as well, in terms of contributing to their education.

This is a crucial component to look at costs and your finances, so that you can consider this important factor when making your college list.

Don’t wait until you decide on a school to estimate your out-of-pocket costs. Start thinking of a financial plan now and what resources you may have, and how much you may need.

For example, if you are considering an exclusive Ivy League school, many of them do not offer merit scholarships. So, use their Net Price Calculator to get an idea if you would be eligible for financial aid (need-based aid). If you are likely not eligible for free grant money based on need, keep in mind you may pay close to the full cost at that school.

Remember, next holiday season you will be looking forward to your acceptance letters as confirmation of the work and thought you are all putting into this process now. The benefit will hopefully be finding the best college choice- for all of you.

 

 

November 2023 Market Recap: Talkin’ Turkey

A bird was on the table for many toward the end of the month. The financial markets plated something nice in November, too – allowing investors to talk turkey in a favorable way.

Two economic reports released in November helped stocks and bonds take flight.

At the beginning of the month, the Labor Department’s regular monthly update on the jobs market showed signs of cooling. Less demand in the labor market suggests an easing of upward pressure on wages and points to the possibility of more modest price increases for goods and services.

The October inflation report, released November 14, provided another positive catalyst for both stocks and bonds. Consumer prices rose 3.2% in the year through October, decelerating from the previous month and showing encouraging signs under the surface.

Inflation has come down meaningfully over the past year after hitting a peak in the summer of 2022. The consumer price report provided further evidence that inflation is headed in the right direction.

In November, the S&P 500 Index of large company US stocks had its highest monthly return in 2023, rising by 9.1%. Foreign stocks also participated in the celebration, with the MSCI EAFE Index rising by 8.2%. Bonds realized their best monthly gain since 1985, as the Bloomberg US Aggregate bond index returned 4.6%.

Year-to-date, US stocks gained 20.7% through the end of November, and foreign stocks have returned 12.4%. Bonds have staged a comeback and were in the black a week before Black Friday. Through the end of November bonds had returned 1.9% year-to-date.