Below are four crucial questions you should be asking your financial advisor right now. Not only will these questions benefit your financial knowledge, but they will help develop your relationship with your advisor.
Do We Need to Meet More Often?
Building a relationship with your advisor is key to making sure your goals align with your long-term investments. Our goal is to help you with your financial investments, but what we are keen on is building long-lasting and personal connections. It is recommended that you should meet with your financial advisor annually (at the bare minimum). This is the time to discuss and review your financial plan and investment performance. During this meeting, there can be discussions regarding any changes to your financial goals and/or other strategies to align your portfolio with what matters most to you.
However, if you feel as you need be more involved and reassured, there is nothing wrong with scheduling more than just an annual meeting. Whether this is semi-annually, quarterly, etc., we are more than happy to meet more often with our clients. We track when we meet. That way, we can keep a consistent schedule. Matt Fry says, “If it is a critical financial event, do not wait until the next time to meet. We can meet as soon as possible. Meeting more frequently also gives us a chance to stay on track with your plan and hold each other accountable.”
How Can We Offset the Effects of Higher Inflation on My Portfolio?
Should you select safer investments or stay the course?
First off, planning for inflation is critical. This is not the first time we have had historically higher inflation. We can look at historical markets to identify variables and financial investments that were successful to storm through this issue. Remember, inflation and interest rates are tied at the hip. Meaning that there is not one without the other. That is why research can be so important during times like this. Advisors need to stay on top of trends and understand the market as much as they can. If they stick to their same old routine, that is not beneficial for your financial goals during higher inflation.
Adjusting your portfolio is important. You will need to look at how much you are saving and spending. These impact your long-term goals, so keeping an eye out for these items play a massive role in this action plan. To select safer investments or to stay on course, that is client specific. At the end of the day, we will give our clients our best advice, but they may still want to do other things.
Are My Retirement Goals Still on Track?
Don't be afraid to check in if you're feeling worried. While your advisor can't control the market conditions, they can give you objective advice about your accounts. Some are worried about the impact that inflation can have on your retirement plan. The effects that inflation has on your retirement plan depends on the assets that you are holding and your spending/savings habits. If the government intervenes with inflation, that is when your retirement and investment plan could be impacted.
The main concern that peoples have is if they will have enough money and/or must go back to work (will I outlive my money or will my money outlive me?). That is why constant communication is something that we are keen on, and if that means we meet more often than originally planned then so be it. We would rather you be comfortable knowing about if you are on track to hit your retirement goals.
What Should I Concentrate on In the Upcoming Year?
Matt Fry says, “For the upcoming year, the plan should be more so what you had planned in the prior year. There could be some minor tweaks, but we should be sticking to the plan that we had initially created.”
Even during a potential recession there are still investment opportunities. Get a jump start on goal planning and know what to expect from your advisor in the upcoming year. This is a question that can be asked in one of your meetings with your financial advisor. From there, a discussion can be had of new goals that are wanting to be achieved. Discussing your portfolio, and opportunities to make it more diverse will be beneficial. This helps promote sustainable and stable investment growth.
If you are someone that is nearing retirement, you would want to create a retirement plan. Having an advisor help coordinate this plan will be beneficial for you. A financial advisor will be able to suggest better ways to manage your investments and help prevent unnecessary taxes. Also, your advisor can inform you about how much you are needing to work to secure the safeness of your retirement goals. This way, we can set realistic expectation and have a plan that is comfortable for both parties.