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The answers you seek are not where you are looking...

The answers you seek are not where you are looking...

May 13, 2021

Okay, so who else thinks that the world has gone stark raving mad?  I think we can all agree that the last 18-months has made for one epic chapter in the book of history. 

I mean we’ve experienced a pandemic, continuing social unrest in America’s largest cities, massive amounts of government spending and some of the most caustic elections in recent memory.  As if that weren’t enough - the crushing weight of social media, surrounds us on a daily basis.  Trying to keep up with the Jones’s coupled with the harsh bitter climate of hyper-partisanship has seemingly done us more harm than good. 

We no longer focus on our goals and measure our successes, rather, we embrace fear and loathe those that differ in opinion and mindset.  It seems that our attention on the political theatre playing out before us has made us lose sight of ourselves, and what we want to accomplish financially. 

We need to step back from this moment of political chaos, economic malady, and stock market volatility, and ask ourselves what really matters in our financial life?  Perhaps we are seeking answers to our financial questions, in the wrong place?  Maybe the answers, aren’t’ buried deep within any government agency, law, or executive order?  What if it didn’t matter what the (insert some meaningless economic statistic here), was?  What if this isn’t about your investments outperforming some random (and most likely unrelated to your goals) benchmark, or of getting in and out of the market opportunely in order to “avoid” any downturns?

Perhaps we aren’t focusing on the right questions?  Despite all of the things that have happened in these last 18-months, I would like to suggest the following questions should STILL be top of mind to you, regardless of the noise coming from all things media:

  1. What am I investing for?
  2. How will I know whether I’m succeeding or not?
  3. How do I even measure my investment success? 

In uncertain times the common mainstream financial narrative will want investors to focus on “protecting” what they have left, and to sell out before financial ruin.  Doomsday prognosticators would have you focus on those things that are 100% out of your control (i.e. just about everything having to do with the economy and politics). 

Let me ask one simple question:  Do you still have a set of specific financial goals for you and your family, regardless of what the economy does?  Regardless of who’s in the White House?  Do you still want to retire?  Would you rather outlive your money, or your money outlive you?

. . .  I already know the answer to that question.  

In these crazy times, let me suggest an easier way for you to focus on what really matters, when it comes to your financial future:

GOALS – The first step of any successful investment plan is to know what are you investing for?  The measurement of your financial success begins and ends with this fundamental question.  You also need to determine how much is enough?  How much do you need to retire comfortably to sustain your current lifestyle?  Your neighbors, your friends, and certainly not any journalist or any financial commentator, can answer that question for you, only you know the answer. 

PLAN – Then start planning.  The most sustainable financial plan is a written, date-specific, dollar-specific plan for accumulating the capital sum needed to reach your GOALS in the time allotted.  To which the plan will answer two fundamental questions:  How much do I need to be putting away, and what rate of return is needed (inflation-adjusted of course) to accomplish the GOALS that I have previously set? 

INVESTMENTS - Understand HOW your portfolio is going to perform in good times and bad times.  Can I stomach the volatility when my investments drop by 20%?  Can I stomach when they go up by 20%?  Because volatility knows no direction, it’s volatility, after all.  Upside and downside volatility is a function of risk, and how much risk do I need, while keeping my GOALS in mind?  Your investments are simply a means to an end.  Your investments have absolutely ZERO to do with any economic or financial outlook.  It’s a matter of owning those investments and in the right combination, that have historically given you the best chance to reach your goals.  After all isn’t that what this is all about?

When you set forth on your journey of setting goals, planning for those goals, and owning the right investments that fit the plan in order to reach your goals, then why worry about who’s President, or what the economy is going to do over the next six-months?  It simply doesn’t matter.  Why do I need to worry about the bumbling buffoon in the mainstream media telling me that he knows my financial goals better than me and my advisor do?  How do they know that completely blowing up my investment plan, during a ‘crisis’ will get me closer to my financial goals?   Oh, that’s right . . . THEY DON’T!

Look closely, because if you’ve already set goals, developed the plan to pursue those goals, and own the correct investments that fit your plan, then the answers you seek, may indeed, be right where you are! 

Thanks for reading.