Who do you think you are kidding Mr Financial Adviser?
“Don’t Panic!” “We’re all Doomed!” Knee-jerk reactions that belong firmly in Dad’s Army and not in the world of financial management.
At a time when certainty in everyday life let alone financial markets is at a premium, a little expert planning and a calm voice is worth its weight in gold.
Watching a repeat of the hilarious approach of Lance Corporal Jones and Corporal Frazer to tackling the problems that arose for Walmington-on-Sea’s Home Guard, made me think of the different reactions of investors to financial matters and how industry professionals can help.
Some people still view taking professional financial advice about investments, such as pensions, as an unnecessary expense.
But far from being an irksome add-on, the expert guidance of a professional can save investors a small fortune in guarding against shock tax bills or making badly judged investment decisions.
At Carrick Financial Management, we regularly update our clients with a newsletter about our company, shedding light on the people who work here, what we do, the value we bring, how we give back to our community and the financial planning advice we offer.We recently focused on the Top Ten Tips for Investing in Tough Times.
How to think ahead about choppy financial waters which history shows us are likely to be not too far away, and not throw up your hands in panic or resign yourself to financial doom.
Part of my review process with clients at the moment is ‘when do you need your money – if it’s in five or ten years, that’s fine, don’t worry about that, you can ride it out.
‘If you need your money next week, next month, next year, then I think we need to proceed with caution.’
That’s why it’s so important for people to take professional financial advice. It’s not just the preserve of the super rich.
It can help make the most of your investments to secure the long-term future of you and your family.
Share prices will inevitably take a hit during market uncertainty, but our advice is that there’s no need to panic.
However, there’s no time like the present to work with your financial adviser to review your portfolio and ensure that it’s positioned to weather any storms that lie ahead.
We’re not talking about a complete overhaul of your investments, but looking at making sensible, incremental changes that give your portfolio extra strength.
Taking steps such as to diversify – not having all your eggs in one basket where they are more susceptible to market volatility, but having different asset classes spread across different sectors and countries.
This way, if one element is performing poorly, another could well make up for that by performing better, making your portfolio more resilient.
Our top tips seem like common sense when you read them – invest in proven quality businesses, think long-term and be prepared to roll with the punches when they land – but such sober thinking can be difficult to find when your life investments are at risk.
Point ten in our checklist can be equated back to Lance Corporal Jones and Private Frazer.
‘This is a fire drill, not a fire.’ No need to unduly panic or resign yourself to your fate, but best to plan ahead now so that if the worst happens, you are prepared.
The trick is to make sure you sit down with a trusted financial advisor and plan your portfolio properly from the outset.
That way, if a downturn strikes, you can stay calm and review your options sensibly and with confidence, rather than hit the panic button and make radical and costly changes.