You don’t need to follow a yellow brick road or consult a man behind a curtain to feel confident about your financial future. This week, Greg borrows a little inspiration from a classic story to remind us the key to a successful retirement may already be within our reach.
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Those first paychecks can be thrilling. It’s like a signal of being a real adult—and all the responsibilities that come with that term. You’re earning real money, but how do you make those earnings powerful? When you spend less than you earn, you develop savings—but how do you learn how to manage those funds?
We think the easiest place to start is to try and sort your financial goals into three buckets.
The first one you have is short-term. This is where you go to find money to deal with emergencies. You also use the short-term bucket to save for annual expenses like real estate taxes or insurance premiums. This bucket must be stable and liquid, to provide money when you need it. Returns are secondary.
On the other end, you have a long-term bucket. If you ever hope to retire instead of going to work every day, or accumulate wealth for other long-term goals, you need one of these—even if retirement feels like forever away. Unlike the first bucket, this one may endure more volatility in the hopes of garnering higher returns over a long-time horizon. You should plan on not tapping this bucket except for those long-term goals, short of an emergency which can be met no other way.
Naturally, the third bucket is in-between. You may have goals for things that happen in a few years, on an intermediate time horizon. It might be for a major purchase like a boat or camper, to meet educational expenses for a child, a down payment on a home you intend to buy at some point in the future.
Not surprisingly, the third bucket may balance stability and higher returns with a middle of the road approach. It might use a mix of investments from the other two buckets, or other types of investments with intermediate stability and returns.
The idea of three buckets is a helpful way to understand the functional purposes of investing. You will need to know something about the basic kinds of investments, styles of investing, some tax considerations, and the options available.
Clients, if you need help sorting the buckets to reach your financial goals, please email us or call.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
All investing involves risk including loss of principal. No strategy assures success or protects against loss.
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by Mark Leibman, Advisor
I learned how to make soup back in the last chapter. Now a variety of soups are a staple of my diet.
Crafting a new soup recipe recently, I started with a chicken, six herbs and spices, and seven kinds of vegetables. I used some olive oil and a splash of red wine vinegar. It may be served with a mix of seven kinds of beans, and rice, of course (you know how I feel about rice and beans!).
It came out really good!—according to a biased observer that I recently married.
Contemplating the choices made in the creation of the soup, I thought about how we build portfolios here at 228 Main.
From many alternatives, we select what we want to own and determine the proportions of each. Another school of thought holds that portfolios should consist of some of everything—500 stocks go into the S&P 500 index, for example, so portfolios get to hold a little of each.
That led me to wonder, What would Index Soup look like?
And it might even be served with 25 kinds of beans, and 10 varieties of rice!
That would have to taste like a little bit of everything, and not much of anything, wouldn’t it?
Just as different recipes can reflect a wide variety of tastes and textures and smells, and we humans have an appetite for different things at different times, our portfolios evolve and change as conditions unfold.
By looking for the best bargains, by avoiding stampedes in the market, by planning to own the orchard for the fruit crop (thinking long-term), our collection of opportunities has diverged from the most popular kind of Index Soup, the S&P 500.
Creating our own recipe helps avoid another possible pitfall of Index Soup—not that it can get too bland in its attempt to average everything, but that it can get too heavy-handed in spicy times.
Recently, slightly more than half of our long-term portfolios are invested in small- and mid-size companies. We’re diversified around the world, although about two-thirds of value is still invested in the U.S. While AI-related stocks have captured the public imagination, we’re focused a little more on value-style stocks than the mega-size growth companies, which we believe may be over-valued at present. No guarantees, but we’re trying to be intentional with our flavors.
Meanwhile, Index Soup focuses on large U.S. companies, with an emphasis on growth. Technology is nearly 37% of the mix in that soup, and the top seven holdings are mega-size tech companies.
We know that the flavor can get “too strong” at times: back in the year 2000, the S&P 500 index, and technology stocks generally, left a bad taste in the mouths of many investors the last time valuations approached extreme levels.
We can’t know the future, but we are hopeful our recipe is going to “taste” a lot better in the months and years ahead. No guarantees—past performance is not an indicator of future results.
But we don’t have to be the best chefs in the world. We’re just trying to find a blend that works for us.
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Investing involves risk including the loss of principal. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
The S&P 500 is an unmanaged index which cannot be invested into directly. Past performance is no guarantee of future results.
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Initial Public Offerings (IPOs) have been in the headlines lately. More than a dozen companies offered IPOs in June 2026. As one example, Elon Musk’s SpaceX offering received a ton of hype and high initial valuations followed shortly thereafter by a significant drop. So we’re encouraging you to take five minutes to hear Billy talk about our take on IPOs.
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Even heroes get knocked down a time or two when fighting their monsters. There may be a couple of bumps in the road, but what good plot doesn’t have some conflict? With our passions in mind, a little bit of perseverance, and a good plan, we all get to be the hero of our own story. Want to talk through what’s important in your story? Call or email to chat.
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