Our Blog

While life is primarily about things far more important than wealth-building, financial freedom does provide mentionable liberties, like the opportunity to give to those in need, the means to see earth’s great natural wonders, the chance to travel and experience diverse cultures, the blessing of working voluntarily, the knowledge to teach financial principles to others, and the joy of leaving a meaningful legacy to heirs. Since financial literacy is not consistently taught in America’s schools, it is generally acquired in adulthood, long after our peak learning capacity has come and gone. Practice the following simple Money Rules that may help improve your wealth-building habits:

50/30/20 Budgeting Rule

• 50% of take-home pay covers essential expenses
• 15% is saved for retirement
• 5% is saved for short-term needs
• 30% is flexible spending

10% Debt Rule

• Maximum 10% of gross income is for debt payment

3-Day Large Purchase Rule

• Wait 3 days before big purchases
• Can help reduce impulse buying

30-Day Luxury Purchase Rule

• Wait 30 days before luxury buys
• Many discretionary purchases lose their appeal over time

20/4/10 Car Purchase Rule

• 20% Down, 4 year loan, 10% payment (keep total transportation costs (loan, insurance, gas) under 10% of gross monthly income))

9 Month Emergency Savings Rule

• Emergency fund equals 9 months’ total household spending

15% Savings Rule

• Invest 15% of gross income for retirement (or more) as early as feasible

Retirement Savings Rule of 25x

• Retirement savings equals 25 times total annual spending

4% Withdrawal Rule

• Seek to limit withdrawals from retirement savings to 4% of total value

Think about it, and may God bless your wealth-building efforts!

Shaun

“Wealth gained hastily will dwindle, but whoever gathers little by little will increase it” ~Proverbs 13:11

“A good man leaves an inheritance to his children’s children” ~Proverbs 13:22

Disclosure(s)

Old Forge Wealth Management, LLC is a state-registered investment adviser. Registration does not imply a certain level of skill or training. This material is provided for informational and educational purposes only and should not be construed as personalized investment, tax, or financial advice. The strategies and guidelines referenced are general in nature, may not be suitable for all individuals, and are not guarantees of future results. All investing involves risk, including the potential loss of principal. Advisory services are only offered to clients or prospective clients where Old Forge Wealth Management, LLC and its representatives are properly licensed or exempt from licensure. Financial decisions should be made based on your individual circumstances and in consultation with appropriate professionals.

A mountaineer can increase both climbing success and safety by learning to discern what cloud formations reveal about impending mountain weather. Since the official mountain forecast is little more than an indication of the conditions which “might” prevail over a maximum period of 48 hours, the ability to discern the clouds becomes essential. A knowledge of how interest rates affect asset values is equally valuable for the investor, who can use that information to potentially get positioned in front of money flows. Consider the fundamentals of changing interest rates:

• Time Value of Money: every asset is essentially worth the present value of its future cash flows. This present value is calculated using a discount rate which is heavily influenced by interest rates, which have the following effects:

Higher interest rates → higher discount rate → lower present value

Lower interest rates → lower discount rate → higher present value

When rates rise, future cash flows become less valuable today, and asset prices historically tend to fall. Conversely, when rates fall, future cash flows become more valuable today, and asset prices historically tend to rise.

• Relative Yields: interest rates also determine the baseline return you can get from “safe” assets like government bonds, which creates the following comparison framework:

Higher rates → Treasury yields rise → risky assets less attractive

Lower rates → Treasury yields drop → risky assets more attractive¹

• Asset-Specific Effects: Bonds have an inverse relationship to interest rates; when rates rise bonds values drop because new bonds pay more. The future earnings of Stocks are discounted as interest rates rise because safe investments pay more (stocks forced to compete with bonds for investor capital); growth stocks are especially sensitive. Real Estate values historically tend to decline as interest rates rise due to higher mortgage rates, which decreases affordability.

Bond markets are often viewed as a key signal of economic expectations due to bond investors possessing a deep understanding of the effects interest rates have on the Time Value of Money, Relative Yields, and the values of Specific Assets. Strive to ingrain these relational principles into the foundation of your investment paradigm, and then extrapolate them further by understanding rates don’t need to change to impact asset values, they merely need to surprise expectations. Consider that recently the stock market was thought to have already “priced-in” two additional 2026 Fed rate cuts; what effect would zero additional 2026 rate cuts have on Treasuries? Bonds in general? Stocks? Real Estate? Commodities? Collectibles? Why?

God bless your wealth-building and financial planning efforts as you deepen your understanding of the effects interest rates have on every financial factor.

Shaun

“Interest rates are to asset prices like gravity is to the apple. They power everything in the economic universe” ~Warren Buffet

“You ought to have invested my money with the bankers, and at my coming I should have received what was my own with interest.” ~Matthew 25:27

1 Stansberry Research, Daily Wealth, “One Thing That Powers Everything in Finance”, Doc Eifrig, April 9, 2026

Disclosure(s)

This material is provided by Old Forge Wealth Management, LLC (“Old Forge”) for informational and educational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security. This commentary is general in nature and does not take into account the specific investment objectives, financial situation, or needs of any individual. The views expressed are those of the author as of the date of publication and are subject to change without notice. Any forward-looking statements or expectations are based on current assumptions and are subject to change. All investments involve risk, including the potential loss of principal. Past performance and historical relationships are not indicative of future results. Information contained herein is derived from sources believed to be reliable, but its accuracy and completeness cannot be guaranteed. Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. This content is not intended to create, and receipt of it does not constitute, an advisory relationship.

The primary concern and biggest navigational deterrent for winter mountaineers is generally a high wind speed. At 70 MPH it becomes questionable as to whether the climber or the wind is in control, at 80 MPH all doubt is removed, and at 100+ MPH the climber is “belly down” and crawling for survival with plummeting prospects for success. It’s notable that other climber “concerns”, like flying snow and ice, physical weakness, and plunging core temperatures are usually direct implications of high winds. Inflation is one of the most influential factors with an equivalent influence over the global economy and asset prices. The early indication is that the 20% reduction in global oil shipments caused by the closing of the Strait of Hormuz may cause higher oil prices to persist into the second half of this year, which may directly impact price inflation economy wide.

Consider the implications of rising inflation:

• Higher interest rates: Central banks (like the Federal Reserve) often raise rates to fight inflation, increasing borrowing costs for businesses and consumers. This reduces investment, hiring, and spending—dragging down economic activity and stock valuations.
• Lower corporate profits: Rising input costs (wages, materials, energy) squeeze profit margins, especially if companies can’t fully pass costs on to customers.
• Reduced consumer purchasing power: Inflation erodes real incomes, so households buy less, weakening demand for goods and services.
• Valuation compression: Higher inflation and rates increase discount rates used in stock valuation models, lowering the present value of future earnings—especially hurting growth stocks.
• Increased uncertainty: Volatile inflation makes it harder for businesses to plan pricing, investment, and expansion, often leading to delayed decisions and slower growth.
• Weaker consumer and business confidence: Persistent inflation can reduce confidence, causing more cautious spending and investment behavior.
• Debt burden stress: Higher rates tied to inflation increase interest payments for companies and households with variable or new debt, raising default risks.
• Currency instability: Inflation can weaken a country’s currency, increasing import costs and creating additional economic strain.
• Policy tightening risk: Aggressive anti-inflation policies can overshoot, potentially triggering recessions or financial market disruptions.

Also consider how the following strategies may help you oppose “belly down” levels of monetary destruction caused by insidious inflation:

• Reprioritize essentials in your budget, like housing, groceries and insurance, while pulling back on discretionary spending, like subscriptions, dining out, impulse spending, and vacationing.
• Reprioritize present income, like work-based compensation, negotiating a raise, increasing specialization in high demand areas, and interest and dividends on invested capital. Understand inflation tends to prioritize a dollar today (dividends) over the promise of a dollar tomorrow (growth).
• Shore up the emergency fund to the equivalent of 6-9 months of total annual household spending and place it in a high yield savings account or Treasury Money Market account.
• Invest in assets that have a built-in inflation protection, like Treasury Inflation-Protected Securities (TIPS), and that have historically performed well during periods of high inflation, like Real Estate and other Real Assets.
• Manage debt as you might a pet scorpion: cage it, starve it, and if it hisses at you, exterminate it! Avoid consumer debt, high interest variable debt, and lock in a lower fixed interest rate before inflation raises rates.
• Manage the timing of spending thoughtfully by pre-purchasing durable goods, while delaying discretionary items that may drop in price later.

Battle inflation as you would a 100+ MPH wind at 14,000 feet, get to the work at hand, and may God bless your inflation-fighting efforts! Shaun

“He who earns wages does so to put them into a bag with holes” ~Haggai 1:6

“A quart of wheat or three quarts of barley will cost a full day’s pay” ~Revelation 6:6

Disclosure

This material is provided for informational purposes only and reflects the views of the author as of the date of publication. It is not intended as investment advice or a recommendation to buy or sell any security.

All market and economic commentary is based on current conditions and expectations, which are subject to change. Forward-looking statements are inherently uncertain, and actual outcomes may differ materially from those expressed or implied.

Investing involves risk, including the potential loss of principal. Past performance is not indicative of future results.

References to specific asset classes or investment strategies are for illustrative purposes only and may not be suitable for all investors. This content does not take into account any individual’s financial situation, objectives, or risk tolerance. You should consult your financial advisor before making any investment decisions.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training.

As my climbing buddy and I emerged from the safety of the below-treeline windshield, we were harshly greeted by 80 MPH winds hurling tiny ice particles straight into our unprotected eyes, preventing even a peak in the direction we hoped to advance! A quick retreat to “goggle up” allowed us to get through the “flying-ice wind tunnel”, but trouble on the descent hours later affirmed we should have listened more intently to the mountain’s early warning that day. While concerning developments relating to the Iran War are not a cause to blindly sell stocks and other risky assets, they are warnings to be observed and weighed in our quest to remain mindful of Warren Buffett’s well-known principle to prioritize avoiding permanent loss of capital. Consider the uncertainties the Iran Conflict presents to the investing landscape:

The Context

• In the last 150 years stock valuations¹ have been higher than today four times, all of which were brief excursions.² The context is that stocks are expensive today.
• The 2/10 Yield Curve, regarded by many to be amongst the most reliable recession indicators, was deeply inverted for over two years and turned positive just 18 months ago.³ This is well within the boundary of time in this historical relationship,⁴ and it would be highly unusual if such an inversion is not followed by recession.
• Priced into today’s stock valuations is the expectation of two more rate cuts this year, nearly mandated by President Trump. Were that not to happen, a revaluation of equities would likely occur.
• Today’s global economy runs on two essential things: debt and energy. A lasting disruption in either of these will likely lead to recession, or worse.

Iran Conflict-Related Developments

• A significant reduction in global oil shipments due to Iran bombing tankers passing through the Strait of Hormuz has introduced an energy supply shock. Refineries in the region are shutting down, and due to the time required to resume operations the resulting spike in oil prices may last long enough to invigorate inflation in the second half of 2026.⁵
• Rising inflation means the Fed may either follow through on its promise to cut rates and repeat the 2021 error of unintentionally stoking already warm inflation, or disappoint the market by not cutting rates. Either scenario could create headwinds for stock prices
• There is trouble brewing in the credit market as a (so far) quiet ‘run’ takes place in the Private Credit and Equity markets due to illiquidity concerns. Redemption requests amongst Non-Traded Business Development Companies surged over 5-fold in Q1 (over Q1 2025), and Blackrock, the world’s largest asset manager, is limiting redemptions. Stansberry Research reports that “concerns about private credit are starting to trickle into the broader credit market”.⁶

A supply shock in energy coupled with a disruption in the credit (debt) market as inflation threats emerge and while stocks are priced to perfection, is a setup that should have our attention. Use your tools, not your emotions to navigate the terrain. Think about it, and may God bless your asset protection efforts!

Shaun

“The prudent sees danger and hides himself, but the simple go on and suffer for it” ~Proverbs 22:3

“Rule #1 is, NEVER LOSE MONEY; Rule #2 is, NEVER FORGET RULE #1” ~Warren Buffet

1 As measured by the average price to earnings (P/E) ratio of the S&P 500 Index

2 LT Charts, S&P 500 P/E Ratio, December 1870 – November 2025

https://www.longtermtrends.com/sp500-price-earnings-shiller-pe-ratio/

3 Y Charts, “10-2 Year Treasury Yield Spread”, 5 Year Chart

https://ycharts.com/indicators/10_2_year_treasury_yield_spread

4 Brighton Jones, “Time to Worry? What an Inverted Yield Curve Does and Doesn’t Mean”, March 27, 2019

https://www.brightonjones.com/blog/inverted-yield-curve/

5 Presentation at FPA Luncheon, March 11, 2026, Harbor Capital

6 Stansberry Research, The Stansberry Digest, “A Rush for the Exits has Begun”, March 10, 2026

Disclosures

Old Forge Wealth Management, LLC is a Rhode Island registered investment adviser. Registration with a regulatory authority does not imply a certain level of skill or training. Additional information about Old Forge Wealth Management, LLC is available in its Form ADV Part 2A, which is available upon request or through the SEC’s Investment Adviser Public Disclosure website at www.adviserinfo.sec.gov.

This commentary is provided for informational and educational purposes only and is not intended as investment advice or a recommendation to buy or sell any security or adopt any particular investment strategy. The views expressed are those of the author as of the date of publication and are subject to change without notice.

This material is not intended to provide a complete analysis of every material fact regarding any country, region, market, industry, security, or investment strategy. Forward-looking statements, opinions, and estimates are based on current market conditions and assumptions and are subject to change. Actual market conditions and outcomes may differ materially from those expressed.

Past performance is not indicative of future results. Investing involves risk, including the potential loss of principal. This material is intended for a broad audience and may not be suitable for all investors.

It fascinates me that in the deadliest (1967) expedition in Denali’s history, five of the seven climbers who perished chose to cower in a snow cave and freeze to death, and two individually died trying to descend “The High One” in a raging winter blizzard alone. My profession has taught me that, fiscally speaking, there are two types of people in the world, wealth producers, who spend less than earnings and wisely invest the difference to grow income and wealth, and wealth consumers, who spend more than earnings and go heavily indebted from crisis to crisis. While the process of wealth-building should be quite straight forward, orchestrated inflation complicates the process immensely. Growing wealth after taxes in real (after inflation) terms is challenging, and asset allocation is the critical factor that separates success from apparent success (where nominal wealth grows while actual (after inflation) wealth shrinks).

When a nation can’t repay its debts on honest terms, it can honestly default, or it can dishonestly attempt to inflate its debt away by increasing the money supply, which increases reported GDP growth, which reduces the “Debt/GDP Ratio”, which presents a more ‘solvent’ financial picture. The inflation scheme is a fool’s errand because the debt never actually goes away. The reasons governments choose inflation include, a) it’s wonderful fun spending other people’s money, b) it maximizes a delay in the consequences of excessive indebtedness, c) it waters those near the spicket most abundantly, and d) it is highly deceptive and goes unnoticed by most of humanity.

Inflation also raises the question of whether we can grow our wealth after taxes faster than the government devalues the dollar. There is “nothing new under the sun”, and historically success has come with high quality capital efficient businesses, real estate, and other ‘real’ (intrinsically valuable) assets. It has notably not come with domestic currency-based fixed income holdings or income streams. Consider the following inflation-fighting principles as you strive to grow your own wealth in real terms:

• Strict budgeting with an eye on inflation will cut expenses and raise investable income. I fired two insurance companies last year which tried imposing 14% and 18% premium increases in a 2.5% CPI year, savings thousands. Buying a modest and certified, pre-owned vehicle can have an even greater positive effect on wealth-building.

• Methodically invest 15%+ of your earned income as you work hard, constantly increase specialization in your chosen field, and seek adequate compensation for your increasing value. Take great enjoyment in serving people well.

• Train yourself to get excited by crashing prices and fearful of euphoric sentiment. Studious investors thrive, but sheep starve. Don’t fight the trend but never follow the herd. Strive to consistently make wise allocation decisions with your God-given capital towards securities which have historically outperformed inflation. Invest only in things you understand.

• Manage risk prudently with an exit plan on risky holdings from the moment of purchase, position-sizing, a portfolio that reflects your risk profile and investment objective, and diversification of holdings to numerous asset classes.

I believe the two climbers who died attempting to descend the mountain had a far higher probability of survival than the five who froze in an unidentifiable snow cave positioned higher on the mountain than helicopters fly. I also believe these principles may help investors improve their chances of preserving and potentially growing wealth after taxes and inflation over time. Think about it, and may God bless your wealth-building efforts! Shaun

“Every good gift and every perfect gift is from above, coming down from the Father of lights, with whom there is no variation or shadow due to change” ~James 1:17

Disclosures

This commentary is provided for informational and educational purposes only and should not be construed as personalized investment advice. The views expressed are those of the author as of the date written and are subject to change without notice.

All investments involve risk, including the possible loss of principal. Past performance and historical trends are not indicative of future results. References to asset classes, market conditions, or investment strategies are for general discussion purposes only and may not be appropriate for all investors. Investors should consider their individual circumstances before making investment decisions.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. Additional information about Old Forge Wealth Management, LLC, including our Form ADV Part 2A disclosure brochure, is available at www.adviserinfo.sec.gov.

While most investors are familiar with the concept of asset ‘allocation’, fewer understand the importance of asset ‘location’. While the former addresses the diversification of investment capital to various asset classes, the latter involves the appropriation of this capital to varying account ‘types’, and more specifically, the way they are taxed. Since financial stewardship has more to do with the wealth we retain and distribute, as opposed to simply amass, taxes must be accounted for, and to the extent possible, shrewdly managed.

In the accumulation phase of one’s working, wealth-building years consideration should be devoted to accumulation efficiency, but not to the exclusion of the reality of future taxation. Many savers over-fund their retirement needs exclusively with Traditional Retirement Plan/IRA accounts, only to later realize they have constructed a tax time bomb! In the early working years, when the income and tax rates are lowest, retirement savings may often be directed primarily to Roth Retirement accounts, depending on individual circumstances. In the mid-working years when the income and tax rates are higher, a balanced approached is often beneficial. As retirement approaches and the income and tax rates hit a career peak, retirement savings may increasingly favor Traditional Retirement accounts. Investors who miss phase one and two are often deprived of the liberty of phase three as their efforts are redirected towards tax bomb defusal.

Retirement ushers-in decumulation as wealth is converted into streams of income, which should shift the tax strategy. A consistent tax rate/bracket in retirement is often associated with greater tax efficiency, while a gyrating rate/bracket equates to tax inefficiency. Diversified asset location, or having a meaningful portion of your God-given capital in each of the three account types: tax deferred (Traditional), tax free (Roth), and taxable (non-retirement), may enhance a retiree’s ability to manage their tax rate! At this juncture complexity appears which only a personal and high-level retirement income plan can solve because tax and account withdrawal strategies must be built around estimated future tax brackets, and only such a plan can reveal them; these calculations can become complex without structured planning.

Strategy solutions and tax code provisions which may help diffuse a tax bomb for those who disproportionately appropriated retirement funds to Traditional accounts include: a) delaying Social Security benefits and creating an income bridge via Traditional account withdrawals, b) strategic Roth Conversions in low bracket years, c) Qualified Charitable Distributions (QCD: age 70.5 minimum), and d) Qualified Longevity Annuity Contracts (QLAC). The rules for these strategies are complicated, so be sure to work with an advisor who understands them well.

Tax planning in both the accumulation and decumulation phases of wealth management is critical, and its neglect may increase exposure to higher taxes for both you and your heirs, but an increase in exposure to Income Tax Rate Risk and Longevity Risk. Think about it, and may God bless your asset location and tax planning efforts! Shaun

“In the abundance of counselors there is safety” ~Proverbs 11:14

“Render to Caesar the things that are Caesar’s, and to God the things that are God’s” ~Mark 12:17

Disclosures

Old Forge Wealth Management, LLC is a registered investment advisor.

This blog is for informational purposes only and is not intended as personalized financial, investment, or tax advice. The content may discuss retirement accounts, asset allocation, and tax strategies, but individual circumstances vary and may affect the applicability of any strategy.

Investing involves risk, including the possible loss of principal. There is no guarantee that any strategy discussed will achieve specific results, reduce taxes, or ensure financial success.

Rules regarding retirement accounts, taxes, and withdrawal strategies are subject to change, and professional guidance is strongly recommended. Please consult a qualified financial advisor and/or tax professional before making any decisions regarding your investments, tax planning, or retirement planning.

The savvy vegetable gardener must mitigate insect risk and rodent risk, drought risk and weed risk, nutrient depletion risk and dead seed risk; the effective mitigation of all but one deadly peril can result in a fruitless garden! Likewise, planning a financially resilient retirement requires identifying and mitigating the following seven hazards, each of which can upend a retiree’s financial life.

• Market Risk involves the possibility of a dramatic decline in asset prices which can leave insufficient capital to fund retirement income needs. Potential mitigation strategies include portfolio diversification consistent with one’s risk profile, proper position sizing, and maintaining an exit plan on risky holdings from the time of purchase. Converting a portion of invested assets into a permanent income stream may help reduce market risk.

• Interest Rate Risk concerns the negative impact that a significant change in market rates can have on a retiree’s income and/or assets. Declining interest rates equate to less annual income on newly purchased fixed income holdings, like CD’s, fixed annuities, and government bonds. Rising interest rates cause outstanding bond values to fall and can result in investment losses.

• Sequence of Returns Risk applies to the disproportionately damaging effect that a bear market proximate to one’s retirement date has on portfolio values. Mitigation strategies include a reduction in portfolio risk during the ‘retirement date’ period, reducing account withdrawals until the market recovers, and a partial conversion of stocks into a lifetime income stream.

• Inflation Risk, perhaps the most difficult of the major hazards to perceive, nibbles away at the purchasing power of each currency unit the way a potato bug does the plant’s nutrient-enriching leaves. Delaying Social Security benefits and allocating a meaningful portion of invested capital in assets which have outperformed inflation over time, like high quality stocks, real estate, and other real assets, can be useful inflation-fighting strategies.

• Risk of Increasing Income Tax Rates is a terrifying proposition to the retiree with 100% of their capital sitting in a Traditional retirement account, yet with both Social Security and Medicare running large deficits, and while presently residing in a relatively low-tax era, the threat is real. Thoughtful asset ‘location’ between taxable, non-taxable (Roth, HSA), and tax-deferred (Traditional) investment accounts, and engaging an ongoing and effective tax management plan can help reduce exposure to this risk.

• Long-Term Care (LTC) Risk, or the potential for a calamitous increase in retirement expenses due to the high cost of care late in life, can impoverish a retired spouse and vaporize legacy assets! Effective mitigation strategies include familial caregiving, advanced trust planning, Long-Term Care insurance, and Medicaid planning.

• Longevity Risk involves the possibility a retiree will live longer than expected and, therefore, need to fund additional years of spending. Delaying Social Security benefits, purchasing a deferred income annuity or a Qualified Longevity Annuity Contract (QLAC), and monitoring the Retirement Income Plan can help contain this risk.

On a scale of 1-10, what is your personal exposure to each of these threatening perils? Which of the potential mitigation strategies are most agreeable with your planning and investment temperament, and most consistent with your financial plan? May your efforts be blessed, and your plan prove fruitful. Shaun

“The prudent sees danger and hides himself, but the simple go on and suffer for it”  ~Proverbs 22:3

Disclosure:

This commentary is provided for informational and educational purposes only and is not intended as personalized investment, tax, legal, or financial advice. Old Forge Wealth Management, LLC is a registered investment adviser. Any opinions expressed are as of the date of publication and are subject to change. Investing involves risk, including the possible loss of principal. Diversification and asset allocation do not ensure a profit or protect against loss in declining markets.

This material may reference general planning strategies, including retirement income planning, Social Security claiming strategies, tax management concepts, insurance planning, annuities, long-term care planning, and Medicaid planning. These strategies may not be appropriate for all individuals and should be evaluated in light of your objectives, risk tolerance, time horizon, financial situation, and overall plan.

References to tax rates, Social Security, Medicare, or other government programs are based on current understanding and may change due to future legislation, regulation, or administrative guidance. For advice specific to your situation, please consult with your tax professional and/or attorney.

Annuities, including deferred income annuities and Qualified Longevity Annuity Contracts (QLACs), are insurance products and are subject to the claims-paying ability of the issuing insurer. Guarantees are based on the financial strength of the insurer. Riders, fees, expenses, surrender charges, liquidity restrictions, and tax consequences may apply.

Long-term care planning and Medicaid eligibility are complex and vary by state and individual circumstances; professional guidance from a qualified elder law attorney is recommended.

The weather report for the Continental Divide west of Denver that day in February 2014 called for sun, +5-degree temps, and gusts to 20mph, perfect conditions for a daylong winter excursion! Unfortunately, we believed the report. After battling mild altitude sickness, -5-degree temps, and constant 60mph winds for seven hours, my overconfidence was exposed and I nearly succumbed to the elements for lack of remembering the indispensable principle, “mountains make their own weather”. No less do the financial markets create their own volatility, and following the 36 months we just experienced, certain principles are important to remember at a time such as this. Let’s identify those principles as we consider the outlook for the financial markets in 2026.

THE OUTLOOK

Major U.S. banks are universally bullish on the S&P 500 for 2026, though expected returns range from a paltry 4% (Bank of America) to a rosy 18% (Oppenheimer). Supporting this outlook are the facts a) the S&P 500 advance/decline line has been rising with continuity that rivals the morning sun, indicating a broad and healthy advancement,¹ b) the CNN Fear & Greed Index stands at 50, or “neutral”, suggesting the psychological euphoria generally cohabitating major market tops is absent, and c) large government and private sector investment in energy sources demanded by AI supercomputers is “LIVE”.² Balancing positive expectations for 2026 is the Presidential Election Cycle Theory, which measures average S&P 500 returns for each distinct year of Presidential cycles since 1950. The study reveals there have been two years of good average returns (years 1 and 4), one year with great average returns (year 3), and one year with bad average returns coupled with increased volatility (year 2).³ Also on the negative side are the facts a) employment is weakening, b) the subprime consumer is tapped, and c) the credit market has shown signs of tightening, but increased economic efficiency from parabolic technological advancement seems to be neutralizing their impact and bolstering corporate earnings, at least for now.

TWO FACTORS TO CONSIDER

• Positive: The market doesn’t seem irrational quite yet, but even if the studies are wrong and it is, the market can remain irrational longer than you can remain solvent. Fight inflation, not the trend!
• Negative: There are exceptions, but investment risk generally rises in tandem with rising valuations (P/E Ratio). Today’s S&P 500 valuation rivals historical peaks, and new investments into large US stocks better understand this research.

CONCLUSION

A highly disruptive global megatrend is in full swing with the widespread adoption of AI and other technological advancements. This trend may render market research less reliable as economic learning and automation accelerate. Dangers lurk but the bull market appears intact. Returns in 2026 may be modest or even negative, and heightened volatility is highly probable as the market prepares for year 3 (2027), the year of great average Presidential Cycle returns.

PRINCIPLES TO REMEMBER IN LATE STAGES OF A BULL MARKET

• Lean, don’t jump. Maintain a diversified portfolio with appropriate asset allocation consistently over time. Never allow emotions, economic forecasts, or geopolitical developments affect investment decisions; rather, use high quality tools to push decisions based on an investment plan. Tweak your allocation, don’t shuffle it.
• Manage risk with an exit plan, especially on speculative and highly appreciated securities. Invest large, but speculate small, and only with well-researched, high conviction ideas.

Don’t forget, mountains make their own weather! May God bless your desires to be a good steward and a wise investor, Shaun.

“Precious treasure and oil are in a wise man’s dwelling, but a foolish man devours it.” ~Proverbs 21:20

1 Market In Out Stock Screener, S&P 500 Advance/Decline Line, January 15, 2026

https://www.marketinout.com/chart/market.php?breadth=advance-decline-line

2 Doc Eifrig’s Health & Wealth Review, “The Banks Are Predicting a Good Year for Stocks”, January 11, 2026

3 Wealth Management, “Presidential Election Cycle Theory”, August 2024 White Paper by John Heilner, CIO

https://www.wtwealthmanagement.com/whitepapers/2024-08/

Disclosure: Old Forge Wealth Management, LLC is a registered investment adviser. This material is for informational and educational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security. This commentary is general in nature and not tailored to the circumstances of any specific investor. The principles discussed are general investment considerations and may not be appropriate for every investor. Individual circumstances, risk tolerance, and objectives should be considered. Market commentary and outlooks are based on current conditions and third-party sources believed to be reliable; however, accuracy is not guaranteed. Forecasts, projections, and return expectations are inherently uncertain and are not guarantees of future performance. Past performance is not indicative of future results. Investing involves risk, including possible loss of principal. Indexes referenced are unmanaged, do not reflect fees or expenses, and are not available for direct investment.

Early in my mountaineering career I discovered that a handful of ginger on the pre-summit push rest stop provides a sustainable burst of energy with no residual crash. I’ve never climbed without a bag of ginger since that wonderful revelation occurred! An experienced climber uses every technical, nutritional and directional advantage available to survive mountain hazards and reach the finish line, which is a warm car. Dodging retirement pitfalls like market and interest rate risk, sequence of returns and longevity risk, inflation and tax-hike risk, and long-term care risk, is no easier, though effective risk mitigation strategies avail. Consider the redeeming qualities (and understand the shortfalls) of a qualified longevity annuity contract (QLAC) as you strategically plan the later income years of your own retirement.

• A QLAC is a special type of deferred annuity you can buy with money from a tax-deferred retirement account (like a traditional IRA or 401(k)). Its main purpose is to provide a fixed source of income later in life, typically starting as late as age 85.
• Money used to buy a QLAC may be excluded from RMD calculations until payouts begin (up to age 85). This can lower taxable income in one’s 70s and early 80s. Maximum contribution is $200,000 or 25% of eligible retirement funds (whichever is less).
• Helps protect against longevity risk (exceeding life expectancy and having to fund the extra years) by providing a guaranteed lifetime income source.
• Tax deferral of QLAC dollars (until income begins) tends to lower taxable income, which can expand strategic Roth Conversion opportunities and other savvy tax maneuvers.
• QLAC’s offer market risk mitigation, since future payments are guaranteed.
• QLAC income complements Social Security to layer income sources and match them with future expenses. Research suggests retirees are happier spending a permanent source of income (like a pension) as opposed to selling assets to create income (like a systematic withdrawal program). They are more confident and content, and they spend more than those using a systematic withdrawal (who actually underspend as a group).¹
• QLAC income is generally received in one’s later years, when inflation is felt most and expenses escalate amidst health declines. That ginger sure comes in handy at high camp!  It can be harder for elder abuse to occur when income streams are passive.

There’s no downside to ginger that I know of, but few things on this earth consist of all positives. QLAC’s reduce liquidity, offer no inflation-fighting upside on invested capital (in an inflationary culture), and actually increase inflation risk (since income payments don’t generally rise). Also, if the retiree passes before income payments begin a loss of capital can occur (unless a return of premium option is purchased).

A QLAC may be well suited for retirees worried about outliving their savings, for those with very large Traditional Retirement account balances, and for those who seek retirement income certainty.

God bless your retirement income planning efforts!

Shaun.

“In an abundance of counselors there is safety” ~Proverbs 11:14

1 The College of America, Retirement Income Certified Professional RICP®, December, 2025

Disclosure: Old Forge Wealth Management, LLC is a registered investment adviser. This material is for educational purposes only and is not individualized investment, tax, or legal advice. Any guarantees referenced are subject to the claims-paying ability of the issuing insurance company. Tax rules are complex and subject to change, and the tax treatment of a QLAC (including any impact on RMD calculations) depends on individual circumstances. There is no guarantee that any strategy will be successful. Consult your financial, tax, and legal professionals before implementing any strategy.