What, Me Worry? | Financial Planning Chapel Hill l Old Peak Financial Advisors

What, Me Worry?

April 17, 2018

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What, Me Worry?

April 17, 2018

Lately, we’ve been getting the following question a lot: “With all the craziness in the world, aren’t you worried about the market?”

The answer: We worry a lot. But not about the market. Instead, we focus our worrying on what we can control.

Study after study shows that short-term market movements are unpredictable. The evidence also shows that, long-term, you are highly likely to do well in the stock market. as long as you control your emotions and own diversified, low-fee funds. Worrying about the market is, if anything, counter-productive.

Here's what we worry about, on behalf of our approximately 100 clients:

Does each client have the right insurance (life, disability, home, auto, umbrella, long-term care)? Has something changed in their lives to make our previous conclusions dated?

Is there anything else a client can do to lower their lifetime tax burden? For example, can they contribute more to their 401k or to a deferred compensation plan? Do they have enough (or too much) in municipal bonds? Will a donor-advised fund help them maximize their charitable deductions?

Is the mix of stock and bonds still appropriate ? Have a client's circumstances changed, making the client more or less able to face short-term market risk?

Have a client's financial goals changed? For example, did they decide they want that second home, previously an unlikely purchase? Did their child's college choice change to a much more (or less) expensive option?

We reach out to every client at least quarterly, and we target an annual update of their financial plan. That's our opportunity to re-assess their entire financial picture and to adjust their plan for changes in their situation. Staying on top of this allows us, and our clients, to sleep easier.

So does a sober understanding that the market will go up, and down, and up, and down -- and no amount of hyperventilation (or buying and selling) will change that.

This article is not intended to provide tax, legal, accounting, financial, or professional advice. Readers should seek advice from qualified professionals who can review their specific circumstances. Old Peak Finance endeavors to provide information that is accurate and current. However, we cannot guarantee that this information has not been outdated or otherwise rendered incorrect by new research, legislation, or other changes. Old Peak Finance has no liability or responsibility to any individual or entity with respect to losses or damages caused or alleged to be caused, directly or indirectly, by the information contained on this website.

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