May 26, 2025

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The Only Constant is Change

Based on thoughtful feedback from many of you, we’re making a few strategic updates to your weekly newsletter. Our goal is to make it easier—and quicker—to find the insights that matter most to you. We’re consolidating sections for better point-and-click accuracy, giving you the freedom to dive directly into what interests you most, whether it’s markets, planning strategies, or broader economic themes.

In addition, we’re preparing to launch our first Global Client Survey. This will be your chance to share what’s working, what’s not, and where you’d like to see us grow. Your voice helps shape the future of how we serve you—so thank you in advance for being part of the conversation.

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NEWS

• Consumer sentiment slides to second-lowest on record

• US Housing Outlook

• Trump’s Retreat Still Leaves Tariffs at 90-Year Highs

• Funnel Cakes, Carnival Rides, and Municipal Bonds

• The Big Four Recession Indicators

• The Rebirth of the 60/40 Portfolio Has Been Greatly Exaggerated

• Don’t Hold Your Breath for Trade Wins from G7 Finance Summit

• Bitcoin Breaks a New Record on Regulatory Hopes

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Wealth Mechanics™

This week we took a dive into the best retirement income strategies for clients. Here, we summarized an article published by Micheal Kitces and shortened it up for easy digestion. Enjoy!

 

Why Measuring Retirement Strategies Matters for Clients

When it comes to retirement income, it’s easy to ask, “What’s the best strategy?” But the better question is: How do you measure success? Depending on what you value most—income, security, or legacy—the “right” retirement plan could look very different. This is where thoughtful, personalized planning becomes powerful.

 

Comparing Three Real Retirement Paths

The article outlines three clear options using the same portfolio, showing how different priorities lead to different outcomes:

1. Safety First: Spend $30,000/year (inflation-adjusted). 90% goes into an immediate annuity for guaranteed lifetime income; 10% is held in cash. Highest confidence of success, but lowest long-term flexibility and legacy value.
2. Balanced Blend: Spend $45,000/year. Invest the portfolio 50% in stocks and 50% in bonds. Moderate income with moderate risk, some flexibility and modest legacy potential.
3. Growth-Focused: Spend $60,000/year. Invest 100% in stocks. Highest income potential, but highest volatility and risk of income cuts in bad markets.

Here are some charts to provide visual context.

 

These charts reveal that while Option C offers the largest spending, it also has the widest range of outcomes—meaning some retirees will thrive, but others may have to sharply reduce income later. Option A, on the other hand, offers peace of mind but at the cost of reduced lifestyle and little to no inheritance. As we said many times before, context is everything!

 

Why This Matters to You

• It’s not about “winning.” Each strategy wins on different terms: income, safety, or upside. What’s “best” depends on what you want most.
• You’re not average. The same strategy that works on paper for the average retiree may not fit your goals or personality.
• Plans aren’t pass/fail. Even if a strategy has a lower Monte Carlo “success rate,” the actual shortfall may be small and manageable—especially with a flexible spending plan.
• We can adjust over time. Market dips, spending shifts, or changing goals? That’s expected. The right strategy allows for mid-course corrections.

Bottom Line

This isn’t about guessing or gambling—it’s about making thoughtful tradeoffs between income, risk, and legacy. We use real modeling tools (like the ones shown in this blog) to guide those decisions so you can feel confident, informed, and empowered.

Let’s find your balance between living well today and sleeping well tomorrow.

 

Source: Kitces.com

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MARKET COMMENTARY

 

Equities: Downgrade Dampens Momentum

• Major U.S. indexes pulled back, with the S&P 500 falling -2.58% for the week and slipping back into negative territory for the year.

• Moody’s downgrade of U.S. debt and escalating tariff talk rattled investors, stalling a six-day equity winning streak.

• Value stocks showed more resilience than growth, especially as tech and consumer discretionary names lagged.

• Consumer staples held up best, down just -0.36%, while energy stocks dragged the most, pressured by news of rising OPEC+ output.

• International equities outperformed U.S. markets, lifted by policy easing in China and improved sentiment in both developed and emerging economies.

Bonds: Longer Yields Surge on Deficit Jitters

• Treasury yields climbed on the back of fiscal deficit concerns and weak demand at a 20-year bond auction.

• The 30-year Treasury yield breached 5.00%, its highest mark since 2023, while the 10-year closed at 4.51%.

• The 2-year yield held steady at 4.00%, but the longer-dated bonds saw notable price declines.

• High-yield bonds underperformed amid a risk-off tone; investment-grade yields ended at 5.35% and high-yield rose to 7.88%.

Macroeconomic Data: Mixed Signals Beneath the Noise

• Headlines were dominated by political drama, but the economic data told a subtler story.

• The Conference Board’s Leading Economic Index dropped -1.0% in April—the steepest monthly slide in over a year.

• Flash PMI data showed signs of life, with both manufacturing and services sectors rising to 52.3 in May, pointing to modest expansion.

• Existing home sales fell to a 7-month low as high mortgage rates weighed on buyers, but new home sales jumped 10.9%—the strongest pace since February 2022.

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INDEX RETURNS

(as of Monday’s Market Opening)

	Total Return (1W)	Total Return (MTD)	Total Return (QTD)	Total Return (YTD)
S&P 500	-0.81%	5.80%	4.99%	0.18%
Dow Jones Industrial Average	-1.33%	3.54%	0.25%	-1.03%
NASDAQ	-0.21%	9.49%	10.42%	-1.08%
NASDAQ 100	-0.29%	8.87%	10.52%	1.40%
Russell 2000 Index	-1.35%	5.76%	3.25%	-6.86%
Russell 3000	-1.14%	6.21%	5.28%	0.30%
ACWI	-0.09%	5.93%	6.47%	5.47%

Source: MorningStar

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ANNUITY WATCH

FIXED ACCOUNT		FIXED ACCOUNT
(premium greater $100K)		(premium  less than $100K)
5.5%		4.25%

Source: Jackson Financial

 

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Disclosures

1. Wealth Mechanics™ is a registered trademark of Cestia Wealth Management. Unauthorized use of the trademark, including but not limited to commercial use, reproduction, or imitation without explicit written permission from Cestia Wealth Management, is strictly prohibited.
2. Advisory services offered through NewEdge Advisors, LLC, a registered investment adviser. Securities offered through NewEdge Securities, LLC. Member FINRA/SIPC. NewEdge Advisors, LLC and NewEdge Securities, LLC are wholly owned subsidiaries of NewEdge Capital Group, LLC.
3. Cestia Wealth Management is not a legal tax professional. We offer tax gap analysis for clients who desire to have a comprehensive financial plan, which requires in-depth tax strategy and planning as a distinct part of the overall customized solution. Please consult your tax professional on all matters addressed in this report.
4. Information about annuities are not to be considered a recommendation. The information provided should not considered a recommendation to purchase or sell any particular security.
5. Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance is no guarantee of future results. Please note that individual situations can vary. Therefore, the information presented here should only be relied upon when coordinated with individual professional advice.