Tuesday, December 4, 2018

Senior's Choice Finance Resources and Elf on the Shelf!



This week's blog post comes to us right from The Senior's Choice!


Finance & Consumer Resources

Reevaluating Your Investments in an Uncertain Market

While most economic experts agree that the fundamentals of the economy are sound, many market watchers are beginning to ask the question: Is this Bull coming to an end? 2018 has been a year of uncertainty, and most financial advisors are recommending investors revisit their portfolios with at least an eye to rebalancing. Here are some suggestions for weathering a potential downturn in the market.
Know that you have the resources to weather a crisis. If you’re retired, knowing that you have the next couple years’ worth of living expenses in a bank account—and several more years in bonds that mature when you need the money—can help keep you calm and clear-headed. You might think you are risk tolerant, but if you haven’t structured your investments to handle a sharp drop, your financial capacity to handle risk may change your attitude when the market does drop.
Match your money to your goals. Map out a plan that takes into account what you’re saving for, whether near-term expenses or future financial goals like retirement. Structure your portfolio to match those goals. Money that you’ll need in the short term or that you can’t afford to lose—the down payment on a home, for example—is best invested in relatively stable assets, such as money market funds, certificates of deposit (CDs) or Treasury bills. Goals that need funding in three to five years should be addressed with a mixture of investment-grade bonds and CDs. For money you won’t need for five or more years, consider assets with the potential to grow, such as stocks, which are more volatile. Your allocation should also account for your time horizon and risk tolerance.
Remember: Downturns don’t last. The Schwab Center for Financial Research looked at both bull and bear markets in the S&P 500 going back to the late ’60s and found that the average bull ran for more than four years, delivering an average return of nearly 140%. The average bear market lasted a little longer than a year, delivering an average loss of 34.7%. The longest of the bears was a little more than two years—and was followed by a nearly five-year bull run. No bull market endures forever, but neither does a bear. And historically the market’s upward movement has prevailed over the declines.
Keep your portfolio diversified. Let’s say there is a slump—what is the best way to insulate against losses? Being well diversified is a preventive measure you can take now. Being diversified means you have a wide variety of investment grade bonds—corporate, municipals, Treasuries and possibly foreign issues. And they should have varying maturity dates, from short-term to mid-term, so you always have some bonds maturing and providing you with either income or money to reinvest. Your long-term assets should be divvied up among a wide array of domestic stocks—big and small, fast-growing and dividend-paying—as well as international stocks, real estate investment trusts (REITs) and commodities. This mix of assets gives you enough diversity that it provides a cushion in your portfolio if specific parts of the market are taking a hit so your exposure in a downturn is lessened.
Include cash in your portfolio. Cash in your portfolio offers protection against volatility, and cash reserves can come in handy in down markets. With cash you can buy in when prices are attractively low—without having to sell securities at a loss, if they are also at a low point.
Find an expert you can count on. If you’re not sure how to structure your portfolio correctly, or you think you’d be tempted to do something rash in a market slide, you should find a financial professional you trust to collaborate with you. That person can walk you through a complete portfolio review and help prepare you and your portfolio for times when the market gets tough.
By Caren Parnes
For The Senior’s Choice

Have you been following our social media? Since it's December, we are posting daily Elf on the Shelf shenanigans again this year to get into the holiday spirit!  Meet Valerie, the Touching Hearts Elf on the Shelf!  She just came back from the North Pole the other day and is going to keep an eye on the office for Santa.  What kind of adventures will she have this year?

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And for christmas, there will be a very special video on our YouTube page!
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