🏡 Home buyers aren't interested

Good morning investors! Welcome back after a long holiday. Let’s check what happened over the weekend and what to look forward to this week.

Today we cover:

• Home buyers don’t seem interested.

• More about Boeing.

• Retirement savings - the situation.

📊 Economy and News 

Rising rates and prices turned home buyers away in April

Sales of new homes fell in April due to rising prices and interest rates.

In April, the median price for a new home was $433,500, a 4% increase from April 2023.

The average rate for a 30-year fixed mortgage was in the high 6% range at the end of March but jumped to 7.5% in April.

Global hits:

• Canadian regular base dividend payouts are expected to grow by an average of 6% year over year.

• India and Japan are bright spots in Asia’s ‘supremely interesting’ equity and M&A markets, JPMorgan says.

• JPMorgan is ‘positive’ on China stocks and ‘constructive’ on real estate as Beijing props up markets. This comes at a time when the country is pumping another $47.5 billion into its chip industry.

In the UK? Check this interesting article covering how a UK election can impact the country’s stock market.

📈 Stocks

S&P 500 5,304.72 (+0.70%)
DJIA 39,069.59 (+0.011%)
NASDAQ 18,808.35 (+0.99%)
BRENT CRUDE 83.01 (-0.01%)
* Prices as of May 28th, 12:20 AM UTC

What’s ahead for Boeing?

Boeing's CFO predicts the company will have negative free cash flow in 2024, due to ongoing manufacturing issues.

Production has slowed because of quality-related problems. Earlier this year, a nearly new 737 Max 9 experienced a door plug failure mid-flight, adding to the company's struggles to repair its reputation following two fatal Max crashes in 2018 and 2019.

This incident led to increased federal scrutiny, and Boeing's executives have pledged to eliminate production flaws and regain the trust of regulators, airline customers, and the public.

Aircraft deliveries are not expected to improve in the second quarter compared to the first, according to CFO Brian West. Meanwhile, attention is also on Starliner.

Despite a "stable" leak in the spacecraft's propulsion system, Boeing and NASA are proceeding with a June 1 launch attempt of the Starliner capsule.

This mission, the first to carry U.S. astronauts on Starliner, was postponed earlier this month. Boeing Vice President Mark Nappi stated that the company can manage the leak and it is not a safety issue.

Good to know: Pfizer aims to save $1.5 billion by 2027 in first wave of new cost cuts.

On the other hand, Google is being criticized as AI Overview makes obvious errors, such as saying former President Obama is Muslim. Reports say that the company is now working on ‘tweaking’ the tool.

🔐 Crypto

Bitcoin $67,775 (-2.30%)
Ethereum $3,845 (-1.15%)
Total market cap $2.54 (-1.43%)
* Prices as of May 28th, 12:20 AM UTC

A look at crypto

Crypto prices have been flirting with different levels for a while, and some say are ready to go higher.

Here’s the latest in the market:

• Ethereum price in ‘bull market’ after spot ETH ETF approvals greenlight a rally toward $4K.

• Caitlyn Jenner falls victim to cryptocurrency exit scam.

• Solana community votes to give validators all priority fees.

• A substantial withdrawal of 1,195 Bitcoin, valued at approximately $81.95 million, has been made from Binance.

• YouTube co-founder backs memecoin based on ‘first cat’ on platform

💵 Personal Finance

Are you 'behind' on retirement savings?

About 56% of adults in the US aren't happy with retirement savings and about 37% are 'significantly behind' retirement goals.

Is this number surprising? Not to us because we know how hard it is to save in today’s environment. You need about a million to retire happily (in the US). The amount, however, depends on a variety of factors.

Here’s how you can know if you’re also ‘behind’ on your plan:

Use online tools

There are several online tools that can help you determine how much you need to save in order to retire peacefully. Some of our favorites are found on sites like Fidelity and T. Rowe. The platforms provide benchmarks for different age milestones and a target for how much to save.

We used both these tools and found this:

• You should have twice your starting salary saved by the age of 35, according to Fidelity.

• You should have 10x your starting salary saved by the age of 67, according to Fidelity.

• You should have 1 to 1.5 times your current annual salary saved by age 35, according to T. Rowe.

• You should have 7 to 13.5 times your current annual salary saved by age 65, according to T. Rowe.

Based on these figures, you can see how close you are to your goal.

Or use our formula

We recommend another method to calculate how much you need to retire: 25x your expected living expenses in retirement, so you can withdraw 4% without running out of money (per the Trinity Study).

The keyword is ‘expected’. Just because you spend $2,000 a month today doesn’t mean you will need $2,000 a month tomorrow. Inflation exists. Plus, you may need more money in the future due to other reasons such as increasing healthcare costs.

So, calculate your required amount using this formula and see how close you are to your goal.

The sad situation

People today just don’t have enough money. Most between 25 and 34 years old have an average 401(k) balance of $30,017, or a median $11,357. The situation is better for the older generation but still not good enough. The average 55 to 64 year old has only $207,874 on average and $71,168 median.

To keep you a little motivated, watch this video about retiring on $100,000.

💰 Be a Better Investor

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.

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