Is the January Effect a real thing?
In this video, James Lenhoff, president of Wealthquest, defines the January Effect and whether or not it’s true.
If you’re not familiar with this term, it’s the idea that January will set the tone for the entire year. Can we count on January to project the trajectory of the next eleven months?
The reality is that, no, this first month of the year doesn’t necessarily mean much in the grand scheme of a calendar year aside from providing a bit of a rebound after December. It’s not definitive. However, there could be a January Effect as it pertains to the rest of your finances.
If you have a goal to pay a certain amount of your debt or want to track your expenses more closely, how you choose to take action in January you will influence the pace for the year. The longer we wait to start making progress on our goals, the more difficult they become to achieve. What can you start doing now so you can reap the benefits in the future?
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