Key Lessons Learned:

• We have been due for a market correction. I don’t know if it’s going to happen right now. There are several things to acknowledge and realize. The market was up a little for the year as of the end of October. A lot of stocks were already down when we got hit with this October volatility.
• Five tech companies make up 20% of the S&P 500. You have a well-diversified portfolio you’re not weighted like the S&P 500. You’re not gambling on technology stocks.
• With our clients we get the diversification right. We spread money across different asset classes and have some of the money safe. If the market drops 20% in theory your investments will only drop 10%.
• If you’re concerned about the market going down or a bear market beginning call us or another financial advisor and make sure that your portfolio is diversified correctly.
• We believe in getting a reasonable rate of return but also building principal protection into the portfolio.
• If you’re still working, and your 401(k) is going down it might be a good time to up your contributions.
• Buy when things are cheap and sell when things are expensive.
• This also might be a good time to rebalance your portfolio.
• What funds are you invested in? Have you based your portfolio on recent performance or long-term goals?
• If you are over 55, it’s a good idea to just earn a certain interest rate on principle to offset volatility in the market.

Is it Okay to Have Volatility If You’re Not Working?

• The price of keeping up with inflation is having some volatility. You need to have some portion of your portfolio exposed to stocks.
• If you don’t have a plan, you need to get a plan. We have a complimentary money map retirement plan that can help you create a portfolio that guards against volatile markets.

Taking the Mystery Out of Your Retirement Plan Statement

• How reliable are Income projections? They’re not reliable. Projections have all kinds of variables.
• What’s up with the asset allocation summary? There are pie charts that show each individual fund and how much money you have in each of those funds. Pie charts that show different asset classes are more helpful.
• This just shows where you are exposed to different asset classes. You don’t want to be overexposed in any area.
• People don’t always see the fees listed on their 401(k). In many cases, it’s not on your account but the administration fee is in there. There are other fees and costs that are difficult to calculate. Cheapest is not always best, but you need to understand the fees.
• Things you should be aware of in the fine print. It doesn’t hurt to read the fine print and try to understand how things work.