Podcast Episode 246: Questions to Ask During Difficult Markets
Today’s Wisdom:
When the market is going strong and the economy is booming, you don’t find yourself worrying too much about your finances. But when times get a bit more challenging, as we’ve seen recently, doubt can start to creep in. Today we’ll tell you which questions you should be asking during difficult markets.
What You’ll Learn:
It’s never easy to control your emotions and ignore the noise when markets are choppy. It’s easy to question what you’re doing and wonder whether you’ve made the right investment decisions.
That’s why it’s always best to put a plan in place that you know will put you in a strong position no matter what happens with the market. Working with your financial advisor to do that is step one and we have a lot of experience in good times and bad. On this episode of the Money Wisdom podcast, we’re going to share the questions that usually get asked during turbulent times and we’ll provide some answers as well.
We’ll begin the discussion with risk because that’s what you feel immediately during a down market. What types of risk should you have? When you talk about managing risk, we start by making sure you understand you shouldn’t put all of your money into anything.
We all know that, right? What we don’t realize is that we’re often spreading our money out into different investments but don’t realize that it’s just a different version of the same thing. That’s why it’s so important to know and understand exactly what you are buying. This ensures that taking the right types of risk because you’re staying balanced and not totally reliant on one thing, whatever that one thing might be.
Once you know what types of risk you should take, it’s then time to figure out how much risk you need in your portfolio. The simple question you need to answer is, ‘How much money do you need?’ Determining that helps you build a plan that makes sure you are taking enough risk to reach your goals while not putting everything you’ve built in jeopardy.
The next area that you might be wondering about during difficult markets is what happens when things start moving up again. Are you positioned to benefit when a bull market begins? We might joke about keeping money in the bank where it’s not generating any return, but you need to have the safe money for an emergency. It’s also important that we have money set aside to take advantage of a down market. Without a plan, most people just end up selling one investment for cheap to buy another investment for cheap with the hopes that the new one increases faster.
On the other side of things is an extended bear market. The question you need to ask yourself is can your portfolio survive if the bear market continues longer than anyone anticipates? Will that downward pressure drive you towards a disaster? If you end up relying solely on the market for income and it stays down for some time, that could end up wrecking your retirement. That’s why we run scenarios that allow you to see what the upside and downside of your portfolio could be.
All of these questions get discussed by our team when you come in and work with us. It all begins with that Money Map review process that helps us get to know you and your goals better and then allows us to build a plan to match. Whether you work with our team or not, make sure you are working with someone you trust and feel comfortable with because they’ll have your back during difficult times.
1:21 – Taking the right types of risk
3:02 – Right amount of risk
4:28 – Are you positioned to benefit in a bull market?
8:49 – What if it’s an extended bear market?
11:00 – Am I talking to the right people?
12:47 – How we make clients comfortable
Thanks for listening to this episode. We’ll be back again next week for another show.
Information presented in our podcasts is considered current as of the created date. Over time, some information presented may become stale. We recommend you consult with your Financial Professional before making any changes based on information contained here.
Johnson Brunetti is a marketing name for the businesses of JB Capital and JN Financial.
Investment Advisory Services offered through JB Capital, LLC. Insurance Products offered through JN Financial, LLC.
The guarantees provided by any type of insurance contract are based on the claims-paying ability of the insurance company.
Related Resources
-
Podcast Episode 411: What Happens to My Money After I Die?
Prefer to watch? Click here to watch and listen on YouTube. No one wants to think about life after they’re gone, but ignoring what happens to your money can leave your loved ones confused and v… -
What’s the Best Age to Start Taking RMDs?
Is it better to take your required minimum distribution (RMD) sooner rather than later? While the IRS determines when you must begin taking RMDs, you may benefit from taking them earlier. An RM… -
Should I Downsize My Home for Retirement?
Equity is on the minds of many pre-retirees and retirees today, more specifically: Should I downsize my home in retirement? And if so, when is the right time to do it? In this week’s Money Wisd… -
Podcast Episode 410: 2 Key Questions to Ask a Retirement Planner
Prefer to watch? Click here to watch and listen on YouTube. Meeting with a financial planner often sparks some of the most important questions. When it comes to retirement, there’s a lot to con… -
How Can You Protect Your Retirement Assets for Your Family?
When you’re focused on planning for retirement, it’s easy to overlook how you can protect your assets for both yourself and your family. While there’s no one-size-fits-all approach, your first ste… -
Podcast Episode 409: Which Retirement Accounts Should I Withdraw from First?
Prefer to watch? Click here to watch and listen on YouTube. Planning for retirement doesn’t end when you stop working. In fact, one of the most important financial decisions you’ll face in reti… -
How to Jumpstart Your Retirement Planning
Retirement planning can feel overwhelming, especially after decades of hard work and diligent saving. With so much to consider, how can you ensure your money lasts as long as you do? The good news… -
What Level of Risk Is Right for Your Retirement Plan?
In this week’s Money Wisdom Question Series, Ian Fergusson, RICP® addresses a fundamental concern for anyone approaching or in retirement: What level of risk is appropriate for my retirement plan?… -
Podcast Episode 408: What to Do in a Down Market
Prefer to watch? Click here to watch and listen on YouTube. As recent market fluctuations have stirred up a lot of economic uncertainty, there’s a particular question on many investors’ minds: … -
Case Study: What Should My Investment Portfolio Include?
As you approach retirement, your investment strategy must shift from aggressive growth to a focus on income generation, asset preservation, and moderate growth to outpace inflation. Consider th…