Five Ways to Harness Your Financial Firepower in the Year of the Dragon

The Chinese people celebrate their new year on unique dates. 2024 is the Year of the Dragon, and the animal holds a special place in Chinese culture. The wood dragon is the fifth animal in the 12 Chinese zodiac signs, and the rabbit is its precedent. The dragon is also mythically associated with high birth rates, unlike the other 11 animals.

The dragon is known for leadership qualities such as power, charisma, authority, passion and creativity. Did you know that these traits hold profound implications for your personal finance journey in 2024?

Historically, stocks have averaged a real return of 7.7% during the dragon years, according to The Economist and Business Insider. The years 1941, 1952, 1965 and 1989 were very strong for the stock market, according to Forbes.

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Dragons are full of vitality and energy and are visionary and goal-oriented. They have a high sense of identity among all the animals in Chinese astrology. The dragon presents itself with tons of confidence, idealism and benevolence.

Each new year is also associated with one of five elements — earth, wood, fire, metal and water. This year is the Year of the Wood Dragon, which offers abundance and longevity. Many people will buy homes, start families and have children.

People born in the Year of the Dragon are idealistic and independent thinkers who always want their community to benefit. They are selfless and yearn for support and love. Dragons are powerful animals, and you can use their traits to meet your financial goals.

Here are five ways you can use the dragon’s traits to achieve financial stability in 2024:

1. Tap into your financial power.

The power of the dragon is always expressed in the animal’s roar. It is also a symbol of assertiveness in the decision-making process. Financial power or strength is the foundation that allows individuals to pursue their goals. It also empowers individuals with resources that allow them to meet their financial obligations and withstand economic challenges. You should be assertive in making decisions about your savings targets and gathering resources to ensure that you pay your bills and invest wisely.

It is important to note that financial strength ensures that you are in a good financial position and you have maximum confidence to pursue your goals. Accessing your credit reports will help you with information about your expenditures and savings. Visit AnnualCreditReport.com to access your free reports from the three credit-reporting agencies, TransUnion, Equifax and Experian.

Ensure that you harness your financial muscle and align it with the potent energy of the dragon. This alignment will ensure that you build financial stability with a cash reserve and a safety net to protect you against unexpected events. For example, after you have your foundation, you can build wealth by participating in your employer-sponsored retirement plans or by opening a Roth IRA or 529 plan.

2. Set your ambitions fearlessly.

When setting your ambitions, you should be fearless like the dragon. Achieving financial prosperity requires you to proactively address financial challenges. You should have a plan on how to implement your financial decisions. Set long-term goals, create a diversified investment portfolio and stay informed about market trends. Like a dragon carefully guarding its treasure, protect your financial assets with prudence and foresight.

3. Match the dragon’s passion and creativity.

With their majestic and untamed nature, dragons bring forth a passionate and creative spirit that catalyzes financial empowerment and innovation. You are encouraged to align your financial pursuits with your deepest personal passions. Creative approaches to budgeting and saving are not just recommended, they become a dynamic means to meet your financial goals.

This year invites you to pursue entrepreneurial ventures with unparalleled fervor, as the dragon's energy thrives on bold and innovative initiatives. You can use life insurance to address survivor income needs, succession planning for a business, wealth creation and estate planning. Take advantage of higher interest rates on cash via high-yield savings accounts, money market accounts and CDs.

4. Be visionary.

The dragon is a visionary animal with benevolent leadership traits. Visionary thinking involves challenging assumptions and evaluating new opportunities. Whether it's adding unconventional assets to your portfolio such as commodities or embracing cutting-edge financial technologies, the dragon's influence encourages you to think outside the box.

Investing in commodities can help address inflation risk and reduce the overall volatility in your portfolio. For example, in 2022, cash and commodities delivered positive market returns while stocks and bonds alike experienced market declines. In 2023, all major stock market indexes ended the year with positive returns: 14% for the Dow Jones Industrial Average, 24% for the S&P 500 and 43% for the Nasdaq, but 2023 was a difficult year for commodities.

5. Focus on diversification and discipline.

Sometimes the most challenging aspect of investing is staying invested. Embrace financial discipline to ensure that you meet your goals. You need to be visionary and diversify your investment portfolio. Just like the dragon, seek all the support that you need from financial planners and have a laser-sharp focus.

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