February 2025 | The Importance of Rebalancing

As we approach the tax filing deadline, I’ve attached two helpful checklists, one regarding necessary tax filing documents, and the other regarding RMDs. 

If you have not yet filed, you might consider giving all necessary documents to your CPA and asking them to wait before officially filing. It is not uncommon for firms to release amended tax documents towards the end of February. 

Market Update

As I watch and read of the market environment, through all of the changes in policies, developments with AI, and the Fed’s continued eye on inflation, I am reminded of the importance of rebalancing. At its core, rebalancing is the discipline of trimming back the portions of the portfolio that have outperformed (portions whose intrinsic value has in turn decreased, due to the inflated price) and using those proceeds to be invested in the portions of the portfolio that have underperformed (whose intrinsic value has now increased, given the cheaper buying price).

In this manner, we maintain diversification, stay properly balanced in risk, and lock in the gains of our winners.

Given that we cannot predict the future, history is our only guide. With history as our guide, we maintain the belief that the most effective manner to achieve our client’s long-term goals (and outpace the lagging effect of inflation and taxes), is to remain invested in a diversified stock portfolio, through the ups and downs, over the life of the financial plan. 

Please note: We will be sending you a separate email with a PDF attached, called “Client’s Corner.” These pieces are written by Nick Murray, one of our favorite financial experts. I highly recommending reading this month’s article. 

Friendly Reminders

• Anti-Fraud – As a friendly reminder, if you receive any messages (text, email, etc.) prompting approval of any transaction you do not recognize, call us immediately. Please refrain from clicking any links associated with a transaction of which you are unaware! These are simple practices to help protect you and the firm, as there are bad actors looking to exploit technology.

• Roth and Traditional IRA Contributions – The deadline to contribute to a Traditional or Roth IRA for 2024 is April 15, 2025. Each individual may contribute a max of $7,000 with an additional $1,000 for those over the age of 50. 

• PWA Portal – Click here to access your PWA portal login. This portal is your one stop shop to view your accounts, balances, and quarterly statements. If you are unable to login, please let us know and we will get you set up.

We’re always here to answer your questions or address your concerns. It is a privilege to serve you.  

On behalf of your PWA team, 

Brock Hedgecoke, CFP® 
Financial Advisor

January 2025 | The Start of the Year

Happy New Year from Perennial Wealth Advisors! 

Start of the Year

In our first full year as Perennial Wealth Advisors, our goal is to keep improving your investment/financial planning experience. Each month we will produce newsletters that offer encouragement for your investment journey, friendly reminders, and financial planning questions to help you stay on track. As we begin 2025, I’ve attached a “Start of the Year” guide that includes pertinent questions regarding:

• Personal Goals

• Cash Flow

• Asset and Debt

• Insurance

• Taxes

• Estate Planning

Please take a look to see which questions pertain to your situation and consider discussing with us in your next meeting. Ideally, this will help us to be proactive and prepared for any upcoming life changes. 

Market Update

We are happy to report a very successful year in our shared pursuit of your most cherished lifetime financial goals. Our plan and our portfolio continue to be driven by those goals, rather than by prognostication around the economy or the markets. This will continue to be the case in the coming year, and beyond. I begin by restating some of our core beliefs, and proceed to a few comments about the current economic/financial backdrop.

General Principles:

• We are long-term, goal-focused, plan-driven investors. Our core investment policy is to invest in broadly diversified portfolios of high-quality businesses.

• We believe that the economy can’t be consistently forecast, nor the markets consistently timed. We conclude from this that the only practical way to capture the premium long-term return of equities is to ride out their frequent, sometimes significant but historically always temporary declines.

• We do not react to economic or market events. As long as your long-term goals remain unchanged, so will our plan for the achievement of those goals.

Current Commentary:

• Powered largely by a very few of the very largest technology stocks, the past year was another exceptionally good one for the diversified equity investor. As the year came to a close, the market gave evidence of broadening out to some extent. That would certainly be welcome.

• The presidential election result was at least clear and uncontested. The economic backdrop continued favorable. The job market remained fairly strong, though showing signs of cooling due to relatively stringent monetary policy. Corporate earnings and dividends reached record highs, and are forecast to increase further in 2025.

• If anything, late in the year many investors feared that the equity market had gotten ahead of itself, as evidenced by somewhat stretched valuations. Since valuations have never proven to be a reliable timing tool—any more than anything else has—we encouraged clients to just keep on keeping on with their plan.

• Inflation has not gone away. Nor, as Fed Chair Powell observed in mid-December, is it going away. A frothy market took this statement rather badly, as indeed it should have, in our opinion.

• And while the fiscal condition of the United States remains undeniably appalling, the consumer is (perhaps surprisingly) in very good shape. The household debt service ratio (debt payments as a percentage of disposable personal income), at 11.3% in the fourth quarter of 2024*, is near 40-year lows.

• It doesn’t seem reasonable to suppose that the broad equity market can go on indefinitely compounding at the nearly 16% it’s been producing since the March 2009 Global Financial Crisis lows. Nor do we need it to. Our long-term plans assume the hundred-year return of the S&P 500 at around ten percent. 

Please note: We will be sending you a separate email with a PDF attached, called “Client’s Corner.” These pieces are written by Nick Murray, one of our favorite financial experts. I highly recommending reading this month’s article. 

*from page 18 of JP Morgan’s Jan. 2025 edition of “Guide to the Markets”

Friendly Reminders

• PWA Portal – Here is a link to your PWA portal login. This portal is your one stop shop to view your accounts, balances, and quarterly statements. If you are unable to login, please let us know and we will get you set up.

We wish each of you a healthy, happy, and prosperous 2025. We’re always here to answer your questions or address your concerns. Thank you for being our clients. It is a privilege to serve you.  

On behalf of your PWA team,

Brock Hedgecoke, CFP® 
Financial Advisor

December 2025 | First and Foremeost, Thank You

To our valued clients,

Merry Christmas from your team at Perennial Wealth Advisors! 

Thank You

First and foremost, thank you. 

As each of you know, this year brought huge changes to our business. We moved away from our former broker-dealer model and started our own, independent Registered Investment Advisor (RIA) firm. We knew this change would not come easy, but we trusted it would lay the foundation for a better firm and an improved client experience. We could not have done it without your patience, trust, and commitment. Thank you for joining us. 

Market Update

We will be sending you a separate email with a PDF attached, called “Client’s Corner.” These pieces are written by Nick Murray, one of our favorite financial experts. In my opinion, he understands the “big picture” of investing and wealth accumulation better than anyone I have read. I am often reminded and encouraged by his work that timing the market cannot be done consistently, and that the best long-term plan is one that pairs a well-diversified, stock portfolio with a client’s time frame and goals. I hope by reading you are equally encouraged. 

Friendly Reminders

1. Required Minimum Distributions (RMDs) – RMDs are minimum amounts that must be withdrawn from retirement accounts each year (due by 12/31), beginning the year your reach age 72 (or age 73 if you reach age 72 after Dec. 31, 2022). You may also be required to take an RMD from an Inherited IRA. We have completed most RMDs for our clients, but if you think you have an account that requires an RMD that has not been satisfied, please give us a call. 

2. Charitable Giving – One option to satisfy your RMD is by making a qualified charitable distribution (QCD) from your IRA. By donating funds from your IRA to a charity, using a QCD, neither you nor the charity will owe taxes on the withdrawal. Separately, if you itemize your taxes, consider a year-end gift to further increase your tax deduction. 

On behalf of your PWA team, 

Brock Hedgecoke, CFP® 
Financial Advisor