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Obsidian Planning
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Obsidian Market Update 5/20/2022

Hi friends!

This week, we’re bringing you the scoop on home values, the market, and cars. Let’s get into it, shall we?

We’re sure you’ve been paying attention to what’s going on in the news. The market is swinging–we’ll get to that in a minute–but there’s also a bright side: the value of your home is up and you can take advantage of the situation.

In the last two and a half months, mortgage rates have gone up so much that a $450,000 loan is now costing $500,000 or more because of the jump in the interest rates. Basically, when inflation goes up, central banks raise interest rates to increase the price of debt, which slows consumer demand. And demand is down, with mortgage applications dropping around 8%, but prices haven’t dropped at all. Quite the opposite, in fact.

In this situation of high home values, you can get a larger equity line on your credit, which we recommend for most homeowners. A larger equity line of credit can act as an emergency fund that doesn’t require you to have cash on hand. As always, we can talk through your specific situation any time–just give us a call and we’ll set it up.

For the last several weeks, we’ve discussed how the market is a bit volatile at the moment. We want to reiterate that we take the long view and keep your portfolio diversified, so that your future isn’t in jeopardy even if the news looks bad on a particular day.

It’s worth noting, too, that drops in the market can be sharp and sometimes feel like they came out of nowhere, but upturns tend to be more gradual. That just means that we can feel more of an emotional reaction to the drops, and that’s valid! But what we can’t do, to use some time-honored therapy-speak, is let our feelings make facts. And the fact is, ups and downs are part of what the market does. Another fact: we’ve got your back. Staying invested, diversified, and disciplined will continue to serve us all well over time.

While we’re talking about good financial strategies, this seems like a great moment to look into which cars, trucks, and SUVs are the most economical to own. With prices of everything car-related going up, it’s good to take an educated approach to which vehicles are worth looking into if you’re in the market for one.

Lucky for us, the Kelly Blue Book does a Five Year Cost-to-Own analysis that is extremely helpful in figuring out what cars are the best options in terms of economics. You can sort by class and read specs on each one. Here are the winners in each class and their projected operating costs for 2022:

  • Compact Car: Toyota Corolla ($31,464)
  • Midsize Car: Honda Accord ($38,713)
  • Full-Size Car: Toyota Avalon ($51,123)
  • Entry-Level Luxury Car: Acura ILX ($41,192)
  • Luxury Car: Volvo S90 ($67,365)
  • Sports Car: Subaru BRZ ($40,397)
  • Hybrid Vehicle: Toyota Corolla Hybrid ($31,231)
  • Electric Vehicle: Nissan Leaf ($34,134)
  • Subcompact SUV: Hyundai Venue ($30,555)
  • Compact SUV: Subaru Forester ($39,473)
  • Midsize SUV – 2-Row: Subaru Outback ($43,973)
  • Midsize SUV – 3-Row: Subaru Ascent ($48,383)
  • Full-Size SUV: Nissan Armada ($69,416)
  • Luxury Subcompact SUV: Lexus UX ($46,424)
  • Luxury Compact SUV: Lexus NX ($51,227)
  • Luxury Midsize SUV – 2-Row: Lexus RX ($62,099)
  • Luxury Midsize SUV – 3-Row: Acura MDX ($60,530)
  • Luxury Full-Size SUV: Lexus LX ($88,956)
  • Off-Road SUV: Ford Bronco ($47,961)
  • Midsize Pickup Truck: Ford Ranger ($40,267)
  • Full-Size Pickup Truck: Toyota Tundra ($47,679)
  • Minivan: Toyota Sienna ($44,376)
  • Luxury Electric Vehicle: Tesla Model 3 ($48,223)

If you’re thinking about buying a new car and want us to weigh in on it, or cash out some funds for you, just give us a call!

That’s it for us this week. Stay cool in the heat this weekend, and we’ll be back in your inboxes next Friday.

How We Help:

One way we enjoy helping people is through providing educational seminars and workshops. Part of being a financial planner is educating our clients on their financial lives, after all. Recently, Todd, Pat, and Becky attended conferences for business owners and conducted seminars on the six most common mistakes that could destroy their businesses. We taught them about things designed to help them avoid making these devastating mistakes. If you’re interested in hearing us speak live at an event like this, keep up with our travel and speaking schedule on our website.

 

Advisory Services offered through Obsidian Personal Planning Solutions, LLC. Securities are offered through Triad Advisors, member ​FINRA/SIPC.​ Obsidian Personal Planning Solutions, LLC, and Obsidian Personal Planning Solutions, Inc, are not affiliated with Triad Advisors.

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