A financial review of 2024
Unpack the major financial events, regulatory changes, and industry innovations that shaped 2024.
Summary
The US economy grew by 2.8% in Q3 2024, but rising costs of living and slow wage growth tempered optimism.
The Federal Reserve is expected to cut interest rates for the third time in December, lowering borrowing costs to the 4.25%-4.5% range.
Sustainable and ESG investing gained momentum as investors prioritised ethical and impact-driven financial decisions.
Advancements in AI and blockchain reshaped financial services, improving efficiency, transparency, and client engagement.
The 2024 financial outlook for the US
At the beginning of 2024, economic forecasts painted a picture of cautious optimism. Inflation was expected to ease, and interest rates were anticipated to stabilise. By the end of the year, the economy delivered a mixed performance, showing resilience in some areas while exposing vulnerabilities in others.
The US economy grew at a rate of 2.8% in the third quarter, exceeding earlier predictions. This growth came on the back of strong consumer spending, steady government investments, and a rebound in exports. While encouraging, cracks remained; rising living costs, slow wage growth, and cautious business spending tempered the overall outlook.
The labour market reflected this mixed sentiment. Unemployment ticked up to 4.2% in November, a modest rise that hinted at cooling demand. While sectors like healthcare and technology continued to add jobs, manufacturing and retail faced cuts, and participation in the workforce dipped slightly. The job market remained stable overall, but the momentum of previous years showed signs of slowing.
Inflation—a persistent financial industry trend of 2024—cooled to 2.7% by November after a high of 3.5% in March. While this offered relief compared to the highs of 2022, core inflation stubbornly held at 3.3%, largely driven by housing and service costs. After cutting rates earlier in the year to encourage growth, the Federal Reserve maintained the benchmark rate at 4.75% in November. However, it is widely expected to announce another 25bps cut to the federal funds rate at its December 2024 meeting, marking the third consecutive reduction of the year. This would bring borrowing costs down to the 4.25%-4.5% range.
While these cuts aim to stimulate economic momentum, businesses have remained wary, balancing optimism about lower borrowing costs with caution around economic uncertainty. Tighter budgets and measured investments have continued to define corporate decision-making and financial goals for 2024.
What were the key financial industry trends of 2024?
The biggest financial industry trends 2024 saw were:
Sustainable & ESG investing
Sustainability was more than one of the big financial industry trends in 2024—it became a priority for investors. Individuals and institutions alike gravitated toward ESG (Environmental, Social, and Governance) investments, driven by a mix of ethics, climate awareness, and regulatory incentives.
Asset managers responded with innovation, introducing products like green bonds and specialised ESG-focused funds. The inflows spoke volumes: ethical investing was no longer a niche strategy but a growing movement with tangible results.
Technology integration
Technology continued to reshape financial services this year. Artificial intelligence (AI) became indispensable, revolutionising client interactions, financial planning, and portfolio management.
Advisors harnessed AI to predict trends, analyse data, and deliver hyper-personalised strategies at record speed. Meanwhile, blockchain technology matured. Its applications in secure transactions, cross-border payments, and asset tokenisation enhanced efficiency and transparency, cutting costs and reducing fraud risks.
Digital transformation
Digital financial platforms became the backbone of the industry in 2024. Younger investors drove demand for robo-advisors and mobile-first solutions, valuing ease of use and affordability over tradition.
Banking apps, budgeting tools, and virtual consultations saw record adoption. For advisors, this digital shift was an opportunity to reach clients wherever they were, blending technology with a human touch to build trust.
Market volatility
Financial markets were a rollercoaster in 2024. Financial events in 2024 were influenced by geopolitical tensions, oil price swings, and shifting monetary policies that kept investors on edge.
Advisors, in response, focused on steady, proven strategies: diversifying portfolios, prioritising conservative assets, and communicating frequently to reassure clients. The year highlighted an enduring truth—stability, not speculation, is what builds confidence during uncertain times.
Evolving client expectations
Clients were more informed and discerning than ever before. With a strong demand for personalised financial advice, 2024 saw clients increasingly seeking tailored solutions aligned with their specific goals and life stages.
Digital access to financial information empowered clients, but it also raised expectations. Advisors had to add real value, offering bespoke strategies and stronger, more relationship-driven service to stand out.
What were the major financial events in 2024?
The year was shaped by events that tested the financial sector’s adaptability and resilience.
Market volatility remained a dominant theme, exacerbated by geopolitical tensions, particularly in Eastern Europe and the Middle East. Supply chain disruptions and fluctuating energy prices added fuel to market uncertainty, prompting investors to tread carefully.
On the regulatory front, the new FinCEN rule marked a significant shift. Expanding anti-money laundering (AML) requirements to include investment advisors brought long-overdue changes to financial compliance. Firms scrambled to implement robust AML programs, aligning themselves with stricter oversight faced by banks. While larger institutions absorbed the changes with relative ease, smaller firms faced growing pains as they adapted to the new rules.
One of the most headline-grabbing financial events in 2024 was Capital One Financial Corporation’s acquisition of Discover Financial Services. Valued at $35 billion, the deal cemented Capital One’s dominance in consumer lending and digital payments.
Analysts noted this acquisition reflected a broader trend of consolidation, with institutions seeking scale and technological capabilities to compete in an increasingly digital landscape.
Financial goals for 2024: insights & lessons learned
For many individuals and businesses, financial resilience became the theme of 2024. Households focused on saving more, building emergency funds, and reducing discretionary spending to weather economic uncertainties. Yet, the lingering effects of inflation made it harder for some to meet their goals.
Investment portfolios reflected the times. Advisors prioritised stability, encouraging clients to diversify their holdings. Bonds, commodities, and alternative assets took a larger share of portfolios, offering protection against market swings. Businesses, on the other hand, zeroed in on reducing debt and improving cash flow to manage higher borrowing costs.
The year offered clear lessons: financial discipline is key, adaptability is non-negotiable, and professional advice is invaluable. Based on financial goals for 2024 and heading into 2025, the message is clear—set realistic financial goals, track progress, and remain flexible in the face of change.
What financial services events were there in 2024?
Financial services events in 2024 underscored innovation, resilience, and regulatory change.
The Global Banking Summit 2024 in London took the spotlight, gathering industry leaders to address the critical challenges of balancing fintech innovation with economic resilience. Discussions tackled geopolitical risks, economic pressures, and the evolving role of digital banking in a globalised world.
The Fintech Meetup 2024 in Las Vegas showcased the power of financial technology. AI tools, digital payment platforms, and fintech startups dominated the agenda, offering financial professionals a glimpse into the industry’s future.
The FINRA Financial Crimes Spotlight Webinar Series, closely tied to the FinCEN rule, tackled emerging financial crimes and the increasing importance of anti-money laundering efforts. Held in collaboration with the FBI, the series equipped professionals with practical insights to address growing risks.
These events shaped conversations, fostered collaboration, and prepared professionals to face the opportunities and challenges of an evolving financial landscape.
How can financial advisors prepare for the new year?
The 2024 financial outlook and the lessons learnt provide a foundation for success in 2025. Financial advisors can begin by reassessing client goals, updating plans to reflect economic realities, and strengthening strategies that work well during uncertain times.
Professional development will remain critical. Advisors who embrace AI tools and emerging technologies will gain a competitive edge, streamlining operations while enhancing their ability to deliver personalised, data-driven solutions. Equally important is staying informed. Anticipated changes in interest rates, inflation trends, and regulations will define the financial year ahead.
By combining knowledge, adaptability, and the right tools, advisors can deliver value that goes beyond numbers.
For a closer look at what’s coming in 2025, read our companion article: 2025: Outlook for Financial Advisors.
Work with Unbiased
Financial industry trends in 2024 stand as a testament to the financial services industry's resilience and adaptability. From shifting economic conditions and technological advancements to evolving client expectations and regulatory changes, professionals have navigated a complex and dynamic landscape.
The lessons learned this year—about discipline, innovation, and forward-thinking strategies—will provide a strong foundation as we look ahead to 2025.
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