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Own Your Wealth with Confidence!

June 30, 2020

This year dynamic health, economic, and financial developments have tested the strength and resolve of people around the world. In February, the Dow Jones Industrial Average reached a high of 29,551 and the S&P 500 reached a high of 3,386. A little more than a month later, both had fallen by over 30%. Investors have experienced a variety of emotions as they have watched the values of their accounts change rapidly and significantly.

While it is impossible to predict with certainty either when or how much investments will rise or fall, it is possible to control pieces of your financial picture with conviction. Through careful decision and deliberate action, you can experience financial confidence and own your wealth even in times of uncertainty.

Cover Your Immediate Needs
Remember what flight attendants say as you prepare for your long-awaited vacation? “In the event of an emergency, put on your own oxygen mask first.” The same principle applies for your finances. For you to continue being the strong person you are for your family and friends during tumultuous times, it is essential that you ensure your own finances are in order. As part of covering your immediate financial needs, consider:

  • Reviewing your expenses
  • Categorizing your cash outflows into “needs” versus
    “wants” versus “wishes”
  • Prioritizing your immediate spend on only your needs, if required
  • Managing your emergency savings; if you tap into them, prioritize replenishing them as quickly as possible
  • Continue paying off your debts; if you pause any payments with your loan servicer, understand all terms, including whether interest will be accrued and when revised payments are required

Focus on the Long Term
While it is unsettling to watch the value of your investments change day to day, retain attention on why you are investing in the first place. You are putting cash to work in the financial markets today with the expectation that it will grow over time. There are inherent risks to investing, like the value of your individual holdings going up and down. That is why great care is necessary when investing to answer the following questions:

  • For what purpose or future expenses do you want to invest your money?
  • When do you need to access your money to pay for the future expenses?
  • How much variation in the value of your money between now and when you need to access it can you handle?

When you answer these questions at the beginning of your investment process, you understand the risks that you are taking with putting your money to work. Revisiting these questions when markets are volatile reminds you of the calculated risks you’ve taken and why. As a result of focusing on the long term and investing with intention, you have greater capacity to experience relative calm in market uncertainty, remain invested in the markets, and benefit from growth in your investments over time, as markets recover.

Take Advantage of Financial Planning Opportunities
Keep in mind that the markets are like many business and life cycles. There inevitably will be ups and downs. Market downturns – while upsetting to experience – are not rare events. Since 1980, for instance, there have been:

  • 12 Corrections: declines of 10% or more
  • 8 Bear Markets: declines of 20% or more that have lasted
    at least two months
  • 5 Recessions: declines in economic conditions for two or more successive quarters

When you are an informed and prepared investor, you build into your financial plan that volatility will happen. You may not know when it will take place, or how severe it will be, but you expect that it will occur. As a result, when the downturn does transpire, you can use the situation as an opportunity to enhance your personal finances.

Over the past few months, my team and I have helped clients use this lower interest rate environment and depreciated asset values to their advantage. For instance, we have:

  • Refined clients’ investment portfolios in tax-efficient ways
  • Utilized tax-loss harvesting techniques in clients’ accounts where appropriate
  • Guided clients through ROTH conversions
  • Re-evaluated and refined charitable gifting strategies
  • Advised clients on how to best manage their liabilities, including refinancing mortgages
  • Provided clients perspective on how various federal relief packages impact them

Wherever you are on your financial journey, regardless of the latest news headlines, you have choices. You can experience a quality of life now and, additionally, set yourself up for financial success in the future.

If you’re ready to navigate life’s inevitable uncertainties with confidence in your financial decisions, I’m right here. Let’s schedule a one-time complimentary thirty-minute financial consult via ZOOM. We’ll talk about how you currently manage the different pieces of your financial picture, observations I have around your approach, and whether my team might be able to assist. Now is your time to own your wealth.

Caroline Wetzel is one of Natural Nutmeg’s 2019 and 2018 10Best Winners for Business/Life Coach. Caroline is a Certified Financial PlannerTM (CFP®) and Vice President, Private Wealth Advisor with Procyon Private Wealth Partners, LLC. Procyon Private Wealth Partners, LLC and Procyon Institutional Partners, LLC (collectively “Procyon Partners”) are registered investment advisors with the U.S. Securities and Exchange Commission (“SEC”). This article is provided for informational purposes only and for the intended recipient[s] only. This article may also include opinions and forward-looking statements which may not come to pass. Information is at a point in time and subject to change. Procyon Partners does not provide tax or legal advice.

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