- Record Household Wealth: U.S. household wealth hit a record $168.8 trillion in Q3, rising by $4.8 trillion or 2.9%, driven by a $3.8 trillion surge in equity values ahead of the election and anticipated rate cuts. Despite this, real estate values declined by nearly $200 billion, reflecting mixed trends across asset classes.
- GDP Growth Revision: The U.S. economy grew at an annualized 3.1% in Q3, exceeding earlier estimates of 2.8%, driven by higher consumer spending and export growth despite headwinds from declining inventories and rising imports. This outpaced the prior quarter’s 3% expansion and surpassed the Fed’s 1.8% non-inflationary growth projection.
- Fed Cuts Interest Rates: The Federal Reserve cut interest rates by 25 basis points, lowering its target range to 4.25%-4.5%, marking the third consecutive reduction. Chair Powell signaled a slower pace of future cuts, with two more expected in 2025, as the Fed balances inflation concerns with maintaining economic growth.
- Dow's Record Losing Streak: The Dow fell for 10 days, marking its longest slide since 1974, driven by the Federal Reserve's signal of fewer rate cuts in 2025. Investor disappointment over tighter monetary conditions led to sharp declines across major indexes, reflecting cautious market sentiment despite strong year-to-date gains.
- Retail Sales Surge: U.S. retail sales rose sharply in November, driven by auto purchases and online shopping, signaling resilient consumer spending despite looming policy uncertainties. Strong household finances and a tight labor market continue to support growth, though concerns over tariffs and inflation could temper spending in 2025.
- Nissan-Honda Merger Talks: Nissan and Honda are negotiating a potential merger under a holding company to enhance competitiveness in the evolving automotive industry. If completed, the merger, potentially including Mitsubishi Motors, would form one of the largest automakers globally, positioning it to better rival Toyota, Volkswagen, and Tesla.
- USPS Privatization Interest: President-elect Donald Trump is exploring the privatization of the U.S. Postal Service, citing ongoing financial losses. This move, if pursued, could impact e-commerce, small businesses, and rural communities, while facing scrutiny over potential disruption to critical delivery services.
- TikTok Ban: The Supreme Court will hear arguments on whether a law forcing TikTok’s parent company ByteDance to sell the app or face a ban violates free speech protections. The case could shape national security policy and impact millions of users and businesses relying on the platform.
- Record Population Growth: U.S. population growth in 2024 hit its highest rate in 23 years, driven by immigration, which accounted for 84% of the increase. The South led regional growth, with Texas and Florida adding over 1 million new residents combined, while the District of Columbia recorded the fastest growth rate at 2.2%.
- Government Funding Bill Passed: The House approved legislation to fund the government through March, preventing a shutdown and securing billions in disaster relief and farm aid. The bill passed with bipartisan support and focuses on sustaining essential services and economic stability heading into 2025.
Still have leftover money in your Flexible Spending Accounts (FSAs)?
- Check with your employer to see if they offer a grace period on your unspent FSA dollars
- FSA grace periods offer you extra time to spend your expiring FSA funds; they begin the day following the end of the plan year for usually 2.5 months
- Grace periods can be applicable to both health and dependent care FSAs
- Claims filed during the grace period come out of the prior year's funds before extracting from the new year's plan
- An FSA grace period is different from an FSA carryover. The FSA carryover provision allows you to carryover a certain amount for the next plan year without a time limit on spending
- As a reminder, Health Savings Accounts (HSAs) always carry over to the next year
- The Health FSA contribution limit is $3,300 with a carryover maximum of $660, up from $3,200 and $640 in 2024
- The HSA contribution limit is $4,300 for individuals and $8,550 for family coverage, up from $4,150 and $8,300 in 2024
- The HSA catch-up contribution for ages 55+ remains unchanged at $1,000
Remember to check that your HSA funds are invested since they are 3X TAX-FREE:
- Payroll deduction contributions toward your HSA are pretax and excluded from your taxable gross income
- HSA investments grow tax-free
- Funds come out tax-free when they are used for healthcare purposes
As the year winds down, markets will closely watch upcoming economic data releases, including inflation and labor reports, which could shape the Fed’s early 2025 policy outlook. With the holiday season driving consumer activity and geopolitical tensions remaining elevated, investors are also preparing for potential shifts in U.S. political dynamics as the new administration takes office.
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2 个月Great advice