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What Should Be My Next Move?

A worldwide pandemic and the resulting implications have shaken the financial markets and us all. COVID-19 continues to be at the forefront of everyone’s minds because there is so much unknown. These are unprecedented times, and understandably, there are a lot of questions. People are worried about their health, well-being and how this will impact their loved ones. The incredibly volatile market is having an impact on retirement funds and making people question even basic financial decisions.

The overwhelming abundance of information can be stressful, but it’s important that you tune out the noise and pay close attention to your finances. Now is the time that having a financial plan and goals is critically important. This is where your trusted advisor comes in. While the change in routine might require patience and flexibility, it’s important that you stay informed about what is happening and that your concerns are not ignored. 

At Lucas Capital Management, we are here to help you understand the impacts of these unprecedented times on your current financial plans, whether you are a current client or looking for an investment professional to help. Any concerns you have need to be addressed. 

People find the stress of financial news in our current climate unsettling and make decisions based on emotion, which could disturb their financial plan. (Just read our recent blog post: Do Your Emotions Hinder Your Investment Results?) In speaking with our clients over the past few weeks, many of their concerns have been these:

  • I have no idea what I want to do next.
  • If I leave my funds alone, will this get better?
  • When is the market coming back?
  • How much money will I lose?
  • When is it safe to get back into the market?
  • Do I continue to fund my retirement account?

Sound familiar? You probably have your own questions to add.

 

If you need to speak with someone about your investment concerns, contact Lucas Capital Management. We are here for you and ready to talk.

 

The Coronavirus Pandemic and the Markets

The pandemic is top of mind for most Americans. But many people do not see the severity of the situation. For example, when the market crashed in March, it ended the longest bull market in history. Investors need to view this as the optimal time to review their portfolios. 

Asset allocation is a fundamental factor when managing your investments, and it should reflect your tolerance for risk. Both asset allocation and diversification provide you the tools to moderate your investment risk. If you’re currently working with a financial advisor, they should review this with you now.

A common misconception is that you can nimbly time the market and move your assets around just in time to benefit from new trends. Most investors can’t or don’t do this, which explains why stock markets can become volatile when conditions change. In effect, many investors ignore the warning signs and rush to sell their stocks when they see sudden changes. This strategy could potentially leave you with limited market exposure. When it comes to your investments, we employ investor discipline that optimizes your portfolio risk. 

Asset allocation is designed to avoid the dangers of market timing. Instead, your age and other factors should govern your allocation of assets. Your advisor should be addressing your concerns and helping you focus on your long-term goals. 

What You Can Do

Investors can succeed in many ways. If you have properly allocated and diversified your assets, take the time to focus elsewhere while the market makes short-term changes. 

Make sure you ask questions and stay informed. Working with a financial advisor you can trust will help provide the peace of mind many investors are looking for. 

When choosing a financial advisor to work with, make sure you ask the following important three questions: 

  1. Are you a fiduciary? Will you act as a fiduciary at all times and put my best interests first? (Get the answer in writing.)
  2. Are you fee-only? Do you make a commission or receive any kind of payment for the recommendations you make? 
  3. What is your area of expertise? Do you have experience with clients with situations like mine? 

If a financial advisor won’t answer these questions, you owe it to yourself to find someone who will.

If you’re currently working with a financial advisor and are unhappy with the service you’re receiving, finding someone new may feel like just another overwhelming task. However, ignoring the instinct to change will ultimately hinder your long-term financial plan. 

If you have any concerns about your portfolio or are unsatisfied with the advice you are getting from your current advisor, contact us. We’re happy to help.