Spring 2025
Hello Friends,
We hope this note finds you well and that signs of spring are emerging in your part of the country. On Logic Lane, our neighbors are embracing the season—getting outside for fresh air, taking the dog for a walk, and digging into the garden. These simple moments offer a welcome pause from the news. The challenges in the world are real, and it’s understandable to feel their impact. And while staying informed is important, the residents of Logic Lane realize that so is making space for the things that bring balance, joy, and a sense of calm in uncertain times.
Change is happening and for some on Logic Lane and elsewhere, the effects may feel distant; for others, it feels deeply personal—like those facing job loss or unexpected shifts in life plans. Many have concerns today which have nothing to do with money, and we understand that finances may be the least of your worries. But no matter the source of uncertainty, we strive to bring thoughtful strategies, to be a partner to help you think clearly about the next steps, and a sense of relief where possible for your financial picture. Today’s world is a great reminder that a well-built financial plan isn’t about avoiding inevitable change and the underlying uncertainty—it’s about building a plan to withstand it.
Today, we’ll introduce you to four neighbors, each finding their way through evolving circumstances. Curveball Craig was notified he will be laid off from his job with the Federal Government and is putting the pieces together of his new reality. Perspective Peter’s steady, straightforward approach reminds us all to stay grounded not only in the literal dirt, but also grounded in what we can control. Wise Grandma Winnie is taking the opportunity to have thoughtful intergenerational conversations about our country’s finances with her curious 12-year-old granddaughter in a way she can understand. And last, retired Rachel, whose working years are behind her, is looking closely at her plans to ensure they remain strong, regardless of what the stock market does tomorrow.
In the spirit of Logic Lane, we encourage you to step outside—both literally and figuratively—and take a moment to zoom out. Life is unpredictable, but very little—whether good or bad—lasts forever. Sometimes, the best thing we can do is take a deep breath, step back, and gain a broader perspective.
Curveball Craig – Turning Setback into Opportunity
Craig recently received the difficult news that his position with the federal government has been eliminated. At 47, he worked at the IRS for under a year when he was among those impacted by recent layoffs. While he’s doing his best not to take it personally, the sudden change is understandably upsetting. But Craig isn’t one to dwell on setbacks—he’s already putting a plan into action.
Knowing for weeks that job cuts were looming, Craig took a proactive approach. He reached out to his network, polished his resume, and set up meetings with former colleagues and mentors. He knows that tax expertise is always in demand, and while the next step may require some flexibility—perhaps even a move—he’s optimistic about new opportunities on the horizon.
Financially, Craig is in a strong position. As a single-income household and someone who prefers financial security, he wisely built up two years’ worth of his $8,000 a month of living expenses between his emergency fund and middle bucket investment account. A total of almost $200,000 he could pile up on his kitchen table tomorrow if he needed to. If the worst-case scenario were to happen and he remained unemployed for over two years, he’d have to dip into his retirement savings—but he’s confident it won’t come to that. More importantly, he reminds himself that this is exactly why he saved in the first place: life is unpredictable, and having a financial cushion gives the freedom to make thoughtful, intentional decisions rather than react in panic.
Instead of seeing this as purely a crisis, Craig is finding the opportunity. He’s even considering returning to school for a master’s in taxation to broaden his career prospects. But first, he’s prioritizing a much-needed reset. After a month of peak stress and uncertainty, he’s heading to the Florida Keys for a week with his college friends to watch some March Madness basketball, recharge, reflect, and remind himself that life is about so much more than work. This setback will pass, and he’ll emerge stronger, wiser, and ready for whatever comes next.
Perspective Peter – Wisdom Grows With Time
At 78 years old, Peter is known for two things—his overflowing summer garden, where a free basket of vegetables waits at the end of his driveway every July, and his steady, no-nonsense advice during uncertain times. Right now, his message is simple: Zoom out. Life has always been unpredictable, and you won’t convince him otherwise.
Peter has lived enough life to know that uncertainty is nothing new. There has always been something to worry about, and if you spend your adult life chasing perfect stability—especially in your investments—you’ll likely end up tired, frustrated, and, worst of all, poor. His advice? When it comes to your investments, own the right amount of stocks for the right amount of time, and let time do the work.
“You’re not going to grow anything—a carrot or your retirement—by digging it up every few weeks to check on it. So stop messing around with it.” Peter reminds us that if you’re feeling anxious, your investments aren’t the right tools to fix it. We have other tools for reducing worry. Investments are tools for growing wealth. Want to feel more secure? Focus on the financial tools that are designed to help provide confidence:
Cash: Keep enough on hand—and double it if you need extra confidence.
Your home: Are your housing costs reasonable? How much do you owe the bank?
Insurance: Are you covered for life’s real risks—a sudden illness, the loss of a loved one, or a house fire?
Spending habits: Are your monthly expenses sustainable, or are you stretched too thin?
That’s where real financial independence comes from—having cash reserves, managing debt wisely, keeping your spending in check, and protecting yourself from life’s biggest risks. If you’re expecting stability from the stock market, you’re looking in the wrong place.
If you own too many stocks for your comfort, that’s a separate problem we can solve. But if you own an appropriate, diversified amount for your long-term goals, then the fact that stock prices react unpredictably in uncertain times means they are doing their job. So don’t let things we expect to happen surprise you —or more importantly, upset you. Stocks aren’t meant to provide stability; they’re meant to grow your wealth so you don’t have to save as much over the long term to reach the same financial goals. Fluctuations aren’t a flaw and doesn’t mean stocks are broken; they’re part of the process.
And if all this uncertainty brings some good “sales” in the stock market? Maybe it’s time to pick up some investments at a discount. Peter would never turn down a good deal—whether it’s fresh produce or a well-priced investment.
Wise Grandma Winnie – Making Sense of Big Numbers
Grandma Winnie rocked gently in her chair, knitting in her lap, as her 12-year-old granddaughter, Sophie, sat across from her, looking puzzled over a news report about government debt. Grandma, “What does it mean that the government has debt? We have learned about money in school, but I don’t know why this is all over the news?” “Alright, sweetheart,” Grandma Winnie said, setting down her yarn. “Imagine your parents make $49,000 a year, but they spend $67,000. That extra $18,000? They put it on a credit card. And not just this year—they’ve done it every year for as long as you’ve been alive. Now, they already owe $358,000 on that card, and instead of paying it down, they keep borrowing more. They make their payments, but a big chunk of their money just goes to paying interest, not actually paying off the debt.” She smiled warmly. “That’s kind of how our government runs. The numbers are bigger, 100 million times* bigger to be exact, but the idea is the same. Borrowing isn’t always bad—it helps in tough times—but if you never balance your spending, it gets harder to manage. And tough choices have to be made sooner or later, just like in any household.” Sophie nodded slowly, the wheels turning in her mind. “So… does that mean we’re in trouble?” Grandma Winnie chuckled, “It means we have to be smart. Just like in life, you can’t spend forever without a plan to pay it back.”
* In Fiscal Year 2024, the federal government’s revenue was approximately $4.919 trillion, expenditures for the same period were about $6.752 trillion, this resulted in a deficit of $1.833 trillion. As of January 2025, the national debt stood at approximately $35.8 trillion.
Source: [ https://usafacts.org/answers/how-much-debt-does-the-us-have/country/united-states/]
Retired Rachel – Adapting Without Panic
At 67, Rachel is enjoying retirement, living confidently off her investments, and not losing sleep over market fluctuations. Her financial stability wasn’t built overnight—it took years of patience, planning, and discipline. Just as she adapted to life’s unpredictability while building her wealth, she continues to do the same in retirement.
Rachel doesn’t view investing with an all-or-nothing mindset. She designed her retirement plan with flexibility, and a long-term perspective, ensuring she can adjust when needed. Planning for a 30+ year retirement, she built a foundation that allows her to navigate market downturns with confidence.
At its peak in February, Rachel’s retirement portfolio was valued at $3 million, and she has been withdrawing $9,000 per month ($108,000 annually), in addition to her $3,000 monthly Social Security benefit—providing a total pre-tax income of $12,000 per month.
Rachel’s portfolio is moderately invested, with exposure to U.S. stocks. Over the past five years, from March 18, 2020 to March 18, 2025, the U.S. stock portion of her portfolio, represented by the Russell 3000 index, has earned an average annual return of over 19%, despite a 20% market decline in 2022. Even if the Russell 3000 were to drop 30% tomorrow, her five-year annualized return would still exceed 11%, a number she would have gladly accepted at the start of her retirement. She understands that when evaluating investments, it’s important to use the right measuring stick, and longer time frames provide better perspective.
Her retirement portfolio isn’t built to work only when the market is at a high—it’s built to work through a range of market conditions. She doesn’t need all of her $3 million at once; she needs a sustainable monthly income for the rest of her life.
Each year, she runs a financial review to ensure she’s prepared for volatility. If her 60% allocation to stocks dropped by 40%, assuming her bond portion was stable, her overall portfolio would decline by about 25%, bringing her total assets from $3 million to $2.3 million. If stocks remained lower for several months or longer, she would temporarily adjust her withdrawals from $9,000 to $8,000 per month until the stock portion of her portfolio recovered. That would bring her total pre-tax income from $12,000 to $11,000, a modest 8% reduction.
Rachel’s financial independence isn’t just tied to her investments. She has $200,000 in cash reserves, covering years of potential income needs if necessary. She owns an $800,000 home outright, offering financial flexibility through home equity if needed. Her portfolio is diversified, ensuring that not all her assets are subject to stock market fluctuations.
If she wanted to maintain her full income without drawing from her investment portfolio during a downturn, she could tap into her cash reserves, use home equity, or adjust other spending choices. With this financial structure in place, she avoids the need for drastic decisions.
Market volatility isn’t what determines Rachel’s financial independence. She has built her retirement on a foundation of planning, adaptability, and long-term thinking. Even a 40% decline in the stock market wouldn’t send her looking for a part-time job, though she does greatly enjoy chatting with her local Walmart greeter.
She didn’t build a $4 million net worth overnight or by reacting to short-term events. Temporary declines only become permanent losses when decisions are driven by panic. Instead of focusing on the market’s daily movements, she packed her bags for a long-awaited weekend trip to Las Vegas to meet her sisters and see the Eagles at The Sphere. We hope you have fun, Rachel.
In Conclusion
As we wrap up our stroll down Logic Lane, the stories of Craig, Peter, Winnie, and Rachel remind us that while uncertainty is inevitable, how we respond to it is what truly matters. Some challenges require resilience, others call for patience, and sometimes, the best step forward is simply taking a breath and zooming out.
Whether you’re adapting to change, seeking clarity in your financial plans, or simply trying to tune out the news and enjoy the present, we hope you find confidence in the things within your control. If there’s anything on your mind, we’re always here to help navigate the road ahead.
Until next time, take care—and maybe take a page from Peter’s book: tend to what matters most, and trust that growth happens over time.
Disclosures:
These are hypothetical examples and are for educational/illustrative purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. No specific investments were used in these examples. Actual results will vary. Please contact your financial professional for more information specific to your situation.
All indices are unmanaged, and investors cannot actually invest directly into an index. Unlike investments, indices do not incur management fees, charges, or expenses. Past performance does not guarantee future results.
Diversification does not assure a profit or protect against loss in declining markets, and diversification cannot guarantee that any objective or goal will be achieved.
