HOW WE HELP
PORTFOLIO REVIEW
BEAR MARKETS HAPPEN FAST - HOW PREPARED Were you and your portfolio for THIS ONE?
Major market meltdowns have become a harsh financial reality for investors. Once they occur the negative impact to a portfolio, and one's retirement net-worth and lifestyle (self-worth) can be devastating and almost impossible to restore. Since the turn of this century, there have been two major market meltdowns experienced by investors. The first one occurred between 2000 and 2002 with the bursting of the Technology Bubble when the S&P 500 dropped 49% and it took 7 years to get back to even. The other meltdown referred to as the Global Financial Crisis (Housing Bubble) occurred from 2007 to 2009 when the stock market plummeted an astounding 57%, and it took 6 years to get back to even. Due to the merciless math of loss, a monumental gain of 132.6% is required to recover from a 57% loss.
These losses can be devastating to your portfolio and the quality of your retirement. Over the last century, buy and hold investment strategies have resulted in significant losses for investors at least once every 10 years. In addition to the Global Financial Crisis and Technology Bubble, do you remember the Asian Financial Crisis in 1997? How about Black (or Melt-Down) Monday in 1987? There are many more painful examples going back all the way to the early 1900s. In 1Q of 2020, we had the "Everything Bubble" bursting from the "Covid Crash" with no place to hide, except in cash.
How long would it take you and your portfolio to recover from a 57% loss? (Answer: a very long time.) How will the current Global Financial Crisis impact your portfolio and your retirement reality or readiness?
There is no doubt these are two very important questions that need to be addressed before the future (financial crisis) shows up on your retirement doorstep. It's impossible to know when the next recession will occur and the financial impact it will have on your retirement lifestyle and portfolio, but we know from considerable experience that the most optimal portfolio for you is the one you will stick with.
When it comes to investing, we believe the only risk that should matter is the risk of not achieving your financial goals. Let us help you design an investment strategy to minimize the risk of not achieving your financial goals and maintaining a comfortable retirement. Your financial life can be complicated; your portfolio shouldn't be.
It's vital for you to remember that a 100% gain on a $100,000 investment, followed up with a 50% loss, does not leave you with $150,000. A 50% loss completely wipes out the 100% gain, leaving you with no return on your original investment. Just imagine being retired and losing 50% of your retirement portfolio during the next global financial crisis. When brutal bear markets present themselves, most Wall Street brokers, financial advisors, insurance (sales) agents, and "modern portfolio" theorists believe their clients (or customers) should "stay the course" and wait for a (Fed engineered) market recovery to get back to even, many months or years down the road.
We believe the best way to make money in the long-term is to not lose it in the short-term. The best long-term investment strategy is first and foremost about managing risk, not return. At TCM, we are risk managers, not investment managers.
A Financial crisis or market meltdown is the worst time to learn your tolerance for risk is much lower than you ever imagined.
Risk happens fast and sometimes quickly to the downside along with our emotions. Now more than ever, it's critical for you to maintain a disciplined approach to investing and avoid making emotional decisions with your hard earned money. Even seasoned investors try to reach for the panic button during a market decline or become overly confident during a sudden market surge. Reacting to market events and making emotional decisions can derail the best-laid investment plan. When we overreact (with fear or greed) in times of stock market stress or mania (meltdowns or melt-ups), we undermine our long-term investment strategy and lose sight of our long-term financial goals.
HAS your portfolio EVER KEPT you up at night?
Today, you can walk into a local mattress store and find the right Sleep Number for your bed. What if it were possible to determine the right Risk Number for your portfolio?
As portfolio experts (not sleep experts), we can help you find your Personal Risk Number. We do this by leveraging Nobel Prize winning science by using a web-based technology called Riskalyze® to help us analyze how much risk you're taking with your portfolio and subsequently align it with your personal goals and preference for risk. It's like getting an X-Ray of your portfolio to make sure you're taking an appropriate level of risk.
Is Your Portfolio Taking You Where You Want To Go IN LIFE?
Click the What's Your Risk Number Box above to answer a few quick and straightforward questions about your age, expected retirement time-frame, and assets earmarked for retirement. You'll be asked about your expectations for gains and losses on your portfolio to help us determine your Personal Risk Number.
After you've completed our five-minute risk quiz, we'll contact you to talk about how your current portfolio is positioned to meet your long-term financial goals. This is a complimentary consultation without any obligation. We won't collect any personal identification information, and we'll never distribute your email address to anyone.
You'll be glad you invested a little time today to make sure your portfolio is properly positioned for the unexpected.
We Can Help You Find Your Risk Number
Remember, if your bed is uncomfortable and keeps you up at night, you can always find your personal sleep number with a Sleep Number bed. If your portfolio keeps you up at night, we can help you find your Personal Risk Number and make sure it's aligned properly with your portfolio to help you achieve and maintain the retirement of your dreams.
Life should be this easy, and it can be for you and your portfolio with our complimentary Portfolio Allocation and Risk Analysis Report from TCM Wealth Advisors. The next step is up to you and your portfolio!