Investing in the stock market requires patience, optimism and tolerance. Although we don’t have any control over what the market does on a day-to-day basis, we do have control over our perspective and how we respond. Making decisions about our investments is best done during calm times in the marketplace.
We have helped our clients weather a number of volatile periods over the past three decades and one thing is for certai: it’s not usually a good idea to make dramatic changes to your investment allocation during difficult economic periods that are typically short-term.
Staying the course is usually the right answer, unless something has also significantly changed in your life recently, such as a considerable change of income due to retirement. Studies have proven that you are better served by tolerating the difficult periods so that you can participate when markets rise.
Experience also tells us that when you have the following items in place, they have the potential to significantly enhance your financial peace of mind.
- Having a trusted financial advisor relationship with a team of professionals who are committed to getting you through difficult times is a tremendous benefit. If you are not working with someone who has ongoing and helpful interactions and communications, you may wish to speak with our team.
- Diversification is imperative. Knowing your portfolio is invested across various asset classes and thousands of equities worldwide helps to control risk and volatility. If you have concerns about whether your portfolio is properly diversified, please contact us to help you to evaluate it.
- Having sufficient cash reserves available can bring peace of mind and staying power with your equity investments. Our team can help you to evaluate your cash reserves and your situation to determine if your reserves are sufficient.
- Having your estate planning complete can have a great impact on your sense of financial peace of mind. Reviewing your documents every few years to remind yourself of the planning you’ve done and to determine if there are any amendments that need to be made due to family changes or changes in the estate tax laws.
- Working towards financial simplicity – reducing and consolidating the number of bank accounts, checking accounts and investment accounts.
- We periodically hear of cases where someone is being sued for potential personal liability and he or she does not have umbrella liability insurance. Having a sufficient umbrella liability policy is a simple, relatively low cost protection. Depending on your net worth, a $1 million to $3 million umbrella policy provides protection not only against unforeseen litigation, but also covers the cost of defending yourself against an unjustified lawsuit.
If you wish to review any of these items with u, including your estate plan or any other topics, we would be honored to hear from you.