Heath Grossman, CFP® here with the Money Wisdom Question Series. Today’s question is, “Why aren’t my investments working for me?”

Defining Investment Success

This is a very interesting question, and I think the path to finding the answer starts with defining what your definition of “working for you,” is. What do you want the investments to do for you? Are you comfortable with risk, with reckless abandon, with no regard for volatility? Or are you looking for more of a reasonable rate of return with a certain degree of safety? Identify what your expectations are of the investments, and ultimately, how the investments are allocated. Do they match that expectation?

Expectations vs. Reality

So I’ll tell you a quick story. One of our advisors sat down with his father-in-law not too long ago, and his father-in-law said, “take a look at this IRA statement. It’s terrible. It never grows and never does anything”. The advisor looked at it and he said, “you’re sitting in cash”. Ultimately, his father-in-law had no idea that the IRA he had was not in fact invested in anything. The IRA was just sitting in cash, and therefore not making any money. This story is an example of where the investor’s expectation was different from how the account was invested.

How A Financial Advisor Can Help

Many people will come to us, and they’ll say, look, this is what I have, is it the right thing for me? And that starts with a conversation around who are you as a person. What are your goals and what are your expectations for the investments? Are your investments making money? And then looking at the investments and getting an objective second opinion on it to see if everything in the right place. What is working well and what can be improved upon? Are your investments working well for you or not?

Thanks for joining me and I hope you found this information helpful!