Party Dow Like It’s 21000 When it comes to meeting your financial goals, time is money no matter what the economy is up to. Dow Jones Financial Plan -Up or down Let’s Party!
By David Rae Certified Financial Planner™, Accredited Investment Fiduciary™
During last year’s election season I puzzled over the large numbers of Americans who incorrectly insisted that the “stock market” has been down since 2008. In fact, US Stock Market indices have reached to a record high, a welcomed recovery after the depths and doldrums of the 2008+ financial crisis. That said, I’m not sure if it is fear or misinformation (a benign way of saying ‘false news’ or ‘alternative facts’) that has kept so many people on the current financial events sideline these past eight years.
Now that the Dow Jones Industrial Average (DJIA) has closed above 21000 for the first time in history, some investors worry they have missed the boat and are wondering if it’s too late to join the party. The simple answer is no and all is well, assuming you don’t need your funds in the near future. (FYI and for comparisons sake, the Dow Jones closed at 7062 on February 27th, 2009.)
Tomorrow is coming- 21000 Dow Jones Financial Plan
Regardless of political affiliation or stock market prognosis, here’s one thing I can say with absolute certainty: each day we all grow a day older. This means we’re all one step closer to the day we retire whether we’re ready for it or not and whether retirement is voluntary or not.
Over the years in my career as a fiduciary financial advisor, I’ve literally heard thousands of excuses for not putting money aside for the future or nurturing investments. There are always reasons not to invest. Some sound rational at the time, others do not. But in reality, most people are probably not investing because they are having more fun spending every penny they make. Either that or they’re forced to spend every penny they make just to make ends meet.
For the long-term investor with real long-term financial goals, today is always the best day to get started. Indeed, investor success is much more about time in the market rather than timing the market.
Here are a few Q & As to help overcome your fear and get on track to meet various financial goals. 21000 Close for the Dow Jones Financial Plan
Q: Do I need to Invest in Stocks?
A: Investing in stocks is not for everyone. However, there is risk in taking too little risk. Very few people are starting early enough and saving enough to reach financial independence without at least some stocks in their portfolios.
Q: How do I figure out the right asset allocation for my investments?
A: Finding the right allocation for your portfolio depends heavily on three factors:
- Your tolerance for risk. Some are comfortable with the potential of losing some of your original investment in exchange for potential to earn greater returns. Keep in mind, just because an investment value fluctuates doesn’t mean you will lose money over the long haul. You may also enjoy: What’s the difference between Investment Risk and Market Volatility?
- The returns you need to reach your various financial goals. If you are rolling in it and only need to earn 3 to 4% to reach your financial goals, why take undue risk? On the other hand, if you need to earn every penny you can, being too conservative means you may never accumulate enough wealth to reach your financial goals.
- Your time frame. Generally, the closer you are to your goal the less risk you can afford to take. Not all goals are created equally on this front either. Being one year away from retirement and one year away from buying a house would not warrant the same asset allocation. When you retire, don’t want to pull your entire savings and spend it in one day. In contrast, when you buy a house, you would pull the down payment out all at once.
Financial Planner LA David Rae on ABC 7 News with Elex Michaelson. “Dow Jones Financial Plan at 21000”
Q: In these uncertain times, I’m scared of the stock market. What can I do?
A: Do not, I repeat not, make any investment decisions without having a financial plan. Reducing your emotional reaction to headlines or sudden moves in the stock market won’t eliminate risk but it can reduce the chance of you making a big investing mistake. It is much easier to take the emotion out of investing if you know not just the what but the why and the how alongside a solid action plan. For example, the what is that you are putting money into a retirement account, the why is to assure your safety and comfort during your golden years, and the how? That’s the biggie you need to figure out and you may need to engage the services of a professional to do it. You can always change your plan but you’ve got to have a plan to begin with.
The important thing is to get started and stay consistent. Work with a trusted fiduciary financial planner to help you craft a financial plan based on your specific needs and time frame. Let them worry about the daily ups and downs of investment so you can go about the business of living your life.
Live for Today, but Plan for Tomorrow.
DAVID RAE, CFP®, AIF® is a Los Angeles-based financial planner with Trilogy Financial Services, a regular contributor to Advocate Magazine, Huffington Post, Investopedia not to mention numerous TV appearances. He helps smart people across the USA get on track for their financial goals. For more financial planning information visit his website at www.davidraefp.com
Advisory Services provided by Trilogy Capital Inc, a Registered Investment Adviser. Separate advisory and securities services may be provided by National Planning Corporation (NPC), a SEC Registered Investment Adviser and broker-dealer. Member FINRA and SIPC. Trilogy Capital, Inc and Trilogy Financial are affiliated by common ownership and are separate and unrelated to NPC. Please consult with your representative to confirm which company’s behalf services are being provided. The opinions voiced in this article are for general information only and in not intended to provide specific advice or recommendations for any individual and does not constitute an endorsement by NPC. Dow Jones Industrial Average is an unmanaged index of 30 widely held securities. Indices are unmanaged measures of market conditions. It is not possible to invest directly into an index. Past performance is not a guarantee of future results. “Dow Jones Financial Plan”