PLAN for an Awesome 2025!

First, here's our quarterly Assets and Liabilities summary of the Federal Reserve Z1. Credit card balances, mortgage debt, and household net values remained unchanged. The big shift was from Bonds to Equities increase, and cash equivalents slightly increased.

What does this mean? Consumers are staying put with their house-related decisions on buying or selling. Said differently, there isn’t a big driver up or down, just more of a horizontal ‘big stay’ until we see a more significant break in rates or a bigger break in house values. The consumer is stable because their overall credit has stayed about the same, but their income has increased.

What’s shocking? Net equity in real estate was always more significant than cash, bonds, and equities until the Great Financial Crisis reset when house values went up but nowhere near as fast as equity values. That, my friends, is inflation at work. That keeps house values up as interest rates went up… because extra money was in that retirement account to fund the higher prices. If we see weakness in employment or house values, we see a big shift in the current logjam of nonactivity…

With the Fed saying it is likely to only cut 50bps in 2025, the real shift and movement will likely come from somewhere else (aka—stocks move down and put pressure on home buyers to keep spending up). But we’ll see. It is the most complicated dynamic I’ve ever seen.

If you are in the getting older category, you might enjoy this recent podcast:

LIABILITY MANAGEMENT
It’s All Relative

According to recent mortgage industry data, almost half of the loan officers actively closing loans in 2021 have left the industry. In June 2021, 178,270 mortgage loan officers (MLOs) had closed at least one loan in the previous year. By January 2024, that number had fallen by 47% to 93,938. This significant drop can be attributed to several factors, including a decline in mortgage activity, increased competition, and economic uncertainty. The data suggests that many MLOs have left the industry altogether due to these challenges.  

Sources and related content Mortgage (if you’ve seen anything more current, please let me know)

The good news is that if this is accurate, it only takes about 50% of the business now to have the same impact on you in 2025 because 47% fewer people support those customer needs, which is you simply responding to the market. If you learn to make your own markets, you’ll grow differently. You have less competition (noise) as you open up new opportunities for yourself. What happens when the market expands as rates drop and inventory rises? You should be able to do a minimum of 2X of your business, but 10X is a real possibility.

Right now is a fantastic time to plan for 2025. My approach:

Review the entirety of 2024. What did I learn? What were my biggest challenges? I can’t know what 2025 will bring, but if I look at the wake of the boat I’m on right now, where is it pointing? Invest 50% of your time looking back at 2024, and then invest the remaining 50% in planning for 2025.

Planning for 2025? Start with 3 years, what is possible in 3 years? What’s your Big Picture? Then, ask yourself where you want to be in 1 year; it should be 25-35% of your 3-year goal. Ask what I need to do AND what I need to stop doing. Then break it down into Quarters; what must you do in Q1 of 2025 to hit your 1-year goal? Now, the fun part: what is my weekly schedule over the first quarter? Plan your weekly activities to make sure you hit those goals.

I have a planner I use, if you don’t have one, email me and I’ll share mine with you: [email protected]

This is my last business act of 2024. I hope you enjoy your holidays with friends and family, good food, and fun. Rest up, 2025 is going to be very different!

PS - I love you all!

LIABILITIES
What’s Happening.

*Some years feel like juggling 3 Rubik’s cubes while solving them:

REAL ESTATE
What’s Happening?

ASSETS
What’s Happening?

ON BEING HUMAN
What’s Worth Sharing?

LET IT BE - by The Scattertones - (Listen on Spotify)

DOPAMEMES
AI Stuff … And Other Happy Moments…

Borrow Smart University || National Institute of Financial Education