Well, I am getting excited for the weather to cool down soon. I’m a little apprehensive though as we get closer to the election. Regardless of who gets in, there will be turmoil in the market. I’ve discussed the strategies that we will implement as we get closer. Our portfolio management team here is proactive. In my 33 years as a financial planner, I’ve seen way too many advisors that are reactive and make moves after a paradigm shift in the market. When you can see things coming, why not try to get ahead of it.

We plan on shifting assets to a more conservative position in advance of the election and take advantage of the direction the market takes, post-election. This is not a decision based on politics, but one based on change caused by events. Democrat or Republican is irrelevant. The decisions are made based on policies that can and will affect the market.

We always have around 50% of clients’ portfolios in strategies that can take advantage of good markets without having any risk of loss in a declining market. Remember, 99% of our clientele are 64 years of age and older. Most cannot afford to lose, so we always manage with this in mind.

When using a financial advisor, we believe that you should always use advisors who are fiduciaries. What this means is that they have an obligation to act in the best interest of the client. When one person does agree to act for another in a fiduciary relationship, the law forbids the fiduciary from acting in any manner adverse or contrary to the interests of the client, or from acting for his own benefit in relation to the subject matter. Some advisors claim to be a fiduciary but, by definition, they may fall short. Some questions that I have are, do you use proprietary products? Proprietary products usually pay a representative a higher compensation than third party products. Does your company only offer your company’s products? I have seen firsthand things that management forces their brokers to do. I have been in offices and heard branch managers offer bonuses if they sold certain funds or stocks, or even requiring brokers to add specific funds or stocks to all portfolios.

In short, whether you are managing your own portfolio or have an advisor, please make sure that they are bracing for a possible impact of known events that are about to happen. Unlike the black swan event of COVID 19, we can prepare for this one. And please make sure that you have a true fiduciary working for you.

%d bloggers like this: