3 Investment Tips To Help You Achieve Your 2019 Goals

The first month of 2019 is over and some of us are yet to figure out our financial resolutions for the year. It is important to identify the areas in which you are looking to invest before it is too late.

In order to make the task a bit easier for you, here are three investment tips to help you in your research, in case one of your goals for the year is to improve your financial health. But before we delve into the details, let us first understand how the economy fared last year and what is expected out of 2019 and thereafter.

Glimpse of the U.S. Economy

The political and economic scenario in the United States was highly volatile in 2018. So what went wrong last year?

Let us begin with the $1.9 trillion tax cut of December 2017, which resulted in a jump in investments in the first half of 2018. However, major incidents and growing speculation of an economic slowdown made the investment boom vanish by the third quarter.

The U.S.-China trade war, the massive data breaches, and cyber warfare threats rocked various industries, particularly technology, resulting in a flurry of institutional sell-offs. Consequently, the gains recorded by the S&P 500 and Nasdaq stocks in the first half of the year were wiped off.

However, a strong labor market outlook and an expected GDP of 2.5% for 2019 means that it is likely to be a Goldilocks economy this year, which is healthy.

Another good outcome of the government’s policies is that after many years of steep raises by insurance companies, premiums are anticipated to fall slightly in 2019.

The Federal Reserve increased interest rates three times in 2018. However, in the announcement on Jan 30, the Fed temporarily suspended its plans to continue interest hikes for 2019. The rates, which range from 2.25-2.50% currently, are likely to remain the same for some time.

Despite the halt in the rising trend of interest rates, banks and insurers are expected to continue to benefit.

Tip 1: Invest In Insurance

If we shift our attention from interest rates to an improving labor market, we can safely conclude that it will be able to boost policy sales even at higher premiums. The unemployment rate is expected to drop to 3.5% in 2019, which should perk up demand for life insurance and annuity products.

The expected fall in premiums makes this investment idea even more attractive.

Furthermore, apart from getting insurance, you can also consider investing in a couple of insurance stocks that are positioned well to reap profits through underlying potency and business modification, riding on rising interest rates, brisk annuity business, solid labor market, and adoption of advanced technology. Investing in stocks with promising long term earnings growth rates, like First American Corporation (NYSE:FAF) and Manulife Financial Corporation (NYSE:MFC) , are likely to give you good returns on investment.

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Tip 2: Invest in Rainy Day & Retirement Funds

Hard times can come without any warning. Speculation about an upcoming recession in an economy that is still reeling from a rocky ride last year adds fuel to the fact that setting up emergency funds and Zacks Investment Research

Written By: Zacks Investment Research