Understanding the Yield Curve: What It Means for APi Group Employees and Your Retirement Planning

Healthcare Provider Update: Healthcare Provider for APi Group APi Group employs a comprehensive approach to employee benefits, which includes providing healthcare coverage through various plans typically managed by major national insurers such as UnitedHealthcare, Cigna, and Anthem. The specific policies may vary based on the needs of the employees and the locations of service, but this collaboration ensures that its workforce has access to a range of healthcare options. Potential Healthcare Cost Increases in 2026 As we approach 2026, healthcare costs are projected to surge significantly, primarily driven by a perfect storm of factors. With medical costs expected to rise by approximately 8.5% for group plans and 7.5% for individual plans, employers and enrollees alike may feel the financial strain. The anticipated impacts of expiring federal subsidies for the Affordable Care Act could lead to more than 22 million enrollees facing out-of-pocket premium increases as high as 75%. Concurrently, health insurers are implementing aggressive rate hikes, further compounding the challenges posed to consumers already grappling with rising medical expenses. Click here to learn more

As a APi Group employee or retiree, you may have recently seen some headlines talking about an 'inverted yield curve' and what it may mean for the economy. An inverted yield curve is just one indicator of the economy's possible direction, and putting these headlines into context is valuable to those affiliated with APi Group.

First, what is the yield curve, and what does it show? The yield curve is a graphical representation of interest rates (yields) paid out by US Treasury bonds. A normal yield curve shows increasingly higher yields for longer-dated bonds, creating an upward swing. An inverted curve has a downward slope, indicating that shorter-dated bonds yield more than longer-dated bonds, which isn't typical. As a APi Group employee, being able to distinguish between these yield curves is important as it will allow better comprehension of interest rates paid out by U.S Treasury bonds.

Does an inverted yield curve mean we’re headed for a recession? Based on the historical track record of this indicator, yes, an inverted yield suggests a recession may be coming. As a APi Group employee, it might be advantageous to do some financial planning to be fully prepared for unexpected events. Since 1976, a recession has followed an inverted curve every time. However, there are some important caveats that you, as a APi Group employee, might benefit from reading here:

An inverted yield curve needs to remain inverted to be considered an indicator. It’s normal for markets to fluctuate as conditions and investor sentiment ebb and flow. But, according to the experts, for an inverted curve to be a recession indicator it needs to stay inverted for a month or more, historically. As a APi Group employee, it is imperative to keep track of indicators and their trends as to be better versed in current market situations.

Source: PGIM

As a APi Group employee it is also worthy to consider how recessions aren’t instantaneous. An inverted yield curve doesn’t mean a recession is just around the corner. Since 1976, the average time between an inverted yield curve and an official recession has been around 18 months; the longest was nearly three years. That’s plenty of time to prepare for what's to come, especially for those living in Texas!

As a APi Group employee, It’s also worthy to note how an inverted yield curve doesn’t cause a recession. The yield curve reflects bond market sentiment – it doesn’t drive it. The yield curve inverts when bond market investors feel like something may be up and, in response, favor shorter-term bonds over longer-term ones. For a APi Group employee, keeping track of bond market sentiment and the yield curve's response to changes in market is beneficial as it promotes better understanding of future market movements.

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It’s a deceptive signal for your portfolio. An inverted yield curve doesn’t mean it’s time to sell! Historically, the market continues to advance following an inverted yield curve, gaining an average of 11.5% real return (net of inflation) since 1976. As a APi Group employee, it is important to not let one indicator spook you!

The takeaway here is that while an inverted yield curve may be unnerving, it’s by no means cause to panic. For fortune 500 employees, it’s an opportunity to assess your specific situation. Our team of retirement-focused advisors are closely monitoring the economic conditions and will proactively alert you should we feel action needs to be taken. In the meantime, feel free to call us if you have any questions or concerns.