How to Get Financially Healthy in 2026

Six Things You Should Know

1. Equity Markets – were up this week with U.S. stocks (S&P 500) gaining +1.42% while international stocks (EAFE) rose +1.17%.
2. Fixed Income Markets – were up this week with investment grade bonds (AGG) rising +0.22% and high yield bonds (JNK) increasing +0.35%
3. U.S. GDP – Delayed estimates suggest the U.S. economy grew by an annualized 4.3% in Q3, the highest rate in two years and an improvement from Q2’s 3.8% growth rate. Consumer spending led the way with a 3.5% increase spread evenly across both goods and services.  
4. Santa Claus Rally – the S&P 500 hit another all-time high this week while treasury yields went lower on positive GDP and unemployment data. A string of better-than-expected economic readings have increased expectations to two rate cuts in 2026, most likely in the first half of the year. 
5. Cybersecurity Reminder- Scammers are increasingly using Remote Access Tools (RATs) along with phishing emails or texts to take control of devices like phones, tablets, and computers. Once installed, these tools can give cybercriminals access to sensitive information, including your Schwab accounts. These attacks can be hard to spot, so if something doesn’t feel right- like unusual account activity or suspicious messages- trust your instincts. If you sense suspicious activity, please call us immediately or report any concerns to Schwab at 800-515-2157. 
6. Client Portal App Update Required – If you’ve experienced any trouble logging into the Hightower App this week, it could be you need to update the app. On your mobile device, navigate to the app-store, search for the Hightower app, and click “Update.”

7. Key Insight: [VIDEO & ARTICLE] Looking for a simple decision chart to improve your financial health in 2026? Read on.

Insights for Investors

By Daryl Geffken

How to Get Financially Healthy in 2026

Too long?  

I’ve been looking back over the year at some of the most common questions we’ve received. They’ve included a variety of areas, like: How can I protect my investments during volatility and market downturns? Should I be nervous about my portfolio when geopolitical events occur? What are the impacts of changes to the tax code? Tim and the rest of the crew have done a great job of answering these.  

There’s one more big category I’ve heard: How do I get financially healthy? Let’s get a little more granular and look at two specific situations today:  

First, I hear a lot of discussion around, “What is the most effective way to build and maintain an emergency fund?”  

In my experience, just about everyone can improve in this area. Frankly, lots of us don’t have an emergency fund. And on the flip side, a lot of us have ones that are too big! What is an emergency fund, and what is it supposed to do? It’s a readily accessible pool of cash saved to cover unexpected, necessary expenses like job loss, medical bills, or urgent home/auto repairs, preventing reliance on high-interest debt and providing a financial safety net for sudden financial shocks. It’s meant for true emergencies, not planned purchases, should ideally cover 3-6 months of essential living costs, and is kept liquid and separate from everyday accounts.  

What it’s NOT For: vacations, new electronics, non-essential upgrades, or planned expenses. I always say it this way: It’s meant to keep the roof over your head, food in the fridge, and clothes on your back. 

Is your safety net strong enough? It’s also important to note that an emergency fund is just part of the overall planning picture for emergency and risk management. This means fully funding emergency savings, but it also means reviewing insurance to ensure overall financial resilience against unexpected life events. 

Here are three practical, high-impact tips for growing an emergency fund: 

1. Automate it and treat it like a bill. 

• Set up an automatic transfer to a separate high-yield savings account every payday—even if it’s a small amount. Make this a separate account from ones you access frequently to avoid the thought of “borrowing” against it from time to time. Also, remember that consistency matters more than size, and just like most resolutions, automation beats willpower and removes the temptation to skip a month! 

2. Start with a clear, reachable target. 

• Instead of jumping straight to 3–6 months of expenses, aim for a first milestone (e.g., $1,000 or one month of essentials). Hitting wins early builds momentum and makes the habit stick. 

3. Use “found money” for building an emergency fund rather than increasing your lifestyle.  

• Direct tax refunds, bonuses, cash gifts, or side-hustle income straight into your emergency fund. When money appears unexpectedly, save it before you get used to spending it.  

The second question flows from the first: Should I prioritize paying off debt or investing extra money for long-term growth? 

In my experience, whether to pay off loans or invest is a balance question. Balancing student loans, mortgages, and credit card debt against building investment portfolios depends on the interest rate, the type of debt, and your financial foundation. Here’s a clear way to decide—without overthinking it. 

Generally speaking, if the interest rate on your debt is less than 6%, it may make more sense to invest any extra dollars. Why? Well, a moderate investment portfolio has typically returned about 6% after accounting for inflation – meaning that a dollar invested historically outperforms a dollar spent to tackle debt of less than 6% (What Is the Average Stock Market Return?; Top 10 questions of 2025). Now, if it’s higher than 6%, let’s tackle it!  

Use this simple guideline for extra money: 

1. High-interest debt (~6%+ APR) → Pay it off first 

2. Moderate-interest debt (4–6%) → Split your money to balance debt-reduction with the opportunity to compound investments. 

• Put 50–70% toward debt
• Invest 30–50% for long-term growth

3. Low-interest debt (below ~4%) → Invest more 

One final investment thought: Don’t leave free money on the table. In practical terms, this means taking full advantage of employer-sponsored retirement plans that offer matching contributions. When your employer matches a portion of what you contribute to a 401(k) or similar plan, that match is essentially an immediate, guaranteed return on your investment—often 50% to 100% of your contribution up to a certain limit. Few investments can offer that kind of instant payoff with no market risk. 

By not contributing enough to receive the full employer match, you are effectively declining part of your compensation. Prioritizing these plans early—before investing elsewhere—can significantly accelerate long-term wealth through compounded growth over time. Simply put, contributing at least enough to capture the full match is one of the smartest and most efficient financial decisions you can make. If you want to reach out, I have a simple 90-day strategy to get these strategies in place. 

So, to summarize, here’s a simple decision chart to improve your financial health in 2026:  

1. No emergency fund → Save first 

2. 401(k) match available → Invest enough to get it 

3. Credit card debt → Pay it off 

4. Remaining money → Split based on interest rate 

As always, thank you for putting your trust in us. Looking back, we had a wonderful year serving you and celebrating with you at our events. Here’s to a great 2026 together! 

Data, Just the Data

U.S. Jobless Claims – initial claims fell by 10,000 last week to a total of 214,000, well below expectations for 223,000. On the other hand, outstanding claims rose higher to 1.92 million.  

U.S. Consumer Confidence – saw a downward revision in December to 52.9. Inflation expectations for 2026 were also revised higher to 4.2%.  

U.K. GDP – surprisingly shrank in October, marking the 4th consecutive month without economic growth.