What To Do Before Rates Drop, A Look at Drawdowns

Happy Monday, wealthy people! 

We’re back from summer vacation and already buzzing with anticipation as the US central bank signaled a rate cut in September, which should enable European banks to continue to cut as well. A very demure, very mindful move, even if a bit late.

But there are two strategies to consider before interest rates fall:

1. Use any short-term cash you don’t need now to lock in a higher interest rate (such as in a High Yield Savings Account or a fixed-term bank account). Then, your earned interest will not be immediately affected when central banks cut rates.

2. Consider waiting before you get a new loan. For fixed-rate loans like car loans, waiting for central banks to lower rates could be beneficial (mortgages are more complicated than that). Even with floating-rate loans, postponing might allow you to benefit from a reduced rate for an initial period, such as three months, if rate cuts occur in September.

In other news, check out our website’s re-branding and the upcoming launch of the Index Masterclass–a crash course for busy professionals who have no time to pick stocks. You can build your entire portfolio with index funds and ETFs. Learn why, when, and how to use them.

In today’s email:

→ Stock Market Update 

→ Investment Strategy Corner - Historical Drawdown Analysis

→ Chart of the Week - 5 Highest Paid CEOs in the UK

Grab your latte and let’s get started!