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The end of the year is a time to show gratitude and celebrate the holidays with your family. It’s also an opportunity to re-evaluate the past 12 months and ask your financial advisor some very productive questions.
1. What is the investment decision process like?
We often judge the merits of a decision by its consequences when the process could be more important. Even if you throw darts and outperform the market, it depends more on luck than skill and cannot be replicated over a long period of time.
Instead, you should be as concerned with the methods your advisor uses to construct their portfolios as you are with the results. Do you use macroeconomic indicators to select asset classes or look at corporate balance sheets for specific indicators?
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Many investors lost large amounts of capital in both 2001 and 2008. This was because advisors lacked a repeatable process for making investment decisions in different economic conditions.
2. What should be done to reduce tax risk?
has several options reduce taxes Contributing to a retirement account, depreciating a rental property, or Harvesting tax lossesAsk your advisor to review your holdings and trades throughout the year to determine if it makes sense to take capital gains and match them against losses.
Now is a good time to plan your tax plans for 2023, as long as you have the opportunity to increase your deductions next year.
3. What are you paying for when you’re not using it?
Since my clients are so focused on their investments, I have to remind them from time to time that I can help them in other areas of their lives as well. Financial he planners don’t just invest their hard earned money. We also offer real estate, long-term care, and education planning. Maximize your relationship by taking advantage of all the services our advisors offer.
4. Are you on track to meet your goals?
we experience a market declineit’s natural to see how much you’ve lost, but you might find it more valuable to know how it affected your ability to meet established goals. The outlook for the year is in order, allowing you to focus on your long-term vision. prevent kneeling reaction It could ruin years of hard work and planning.
5. Should I do something different?
Your goals evolve over time and the way your advisor manages your issues needs to change. Have you had a life-changing event, found a new passion, or need a different approach? Have you experienced a health event?
A client may choose to work longer in a more rewarding, low-wage career. If you’ve suffered a loss in your retirement account, you’ll want to find out how it affects your ability to retire while you have time to adjust.
Define what you want your life to look like and enlist a team of advisors to help you get there.
This is a great time to identify how your advisor intends. correspond to the economy The high cost of capital, high cost of living, and historically low liquidity make the market less likely to recover soon.
Your financial advisor drives the bus, but the bus is your bus. Be sure to tell them where you are going.
— By Ivory Johnson, Certified Financial Planner and Founder of Delancey Wealth Management, LLC