I won’t sugar coat it- the stock market has had a tough start to 2022. However, I encourage you to consider ways to benefit from this cycle, which will potentially help you reach your financial goals in the future. We have experienced down markets before and we will experience them again. Some of the strategies below may help you think differently about market pullbacks and engage in additional conversations with your financial advisor. If you aren’t having these conversations, please let our team at BMG Advisors know if we can help you in any way.
· Think TAXES. No one wants their net worth to fall, but market pull backs are a wonderful time to think about tax strategy. Great options to consider might include tax loss harvesting, Roth conversions, review and potentially reduce concentrated positions, and potentially additional estate planning considerations.
· There are deals everywhere. Work to train your brain that this is the very best time to buy. Just like when you get excited to save money on a vacation package or negotiate a better price on a car, right now the market is providing a potential opportunity on most securities. Depending on your risk tolerance and timeframe for needing the money, this may be a great time to add more to positions. Additionally, prefunding current year retirement plan contributions or education contributions are impactful strategies to consider.
· Focus on the plan. Take this time to review or begin formulating your overall financial plan. This data along with understanding of the strategies your advisor team is taking may help you to focus on the long term and less on the day-to-day market volatility. The more you understand how the various aspects of your financial world are positioned for your short- and long-term goals, the better you will feel when the market is down.
· Review your risk appetite. As markets fluctuate, try to remember how you feel. While this is not the best time to sell funds or lower your risk profile, it is important to adjust this if needed when the market rebounds. Talk with your advisor about how you are feeling and potentially take your foot off the gas when the market is at a higher point.
· Take care of yourself. Navigating stress is far easier when caring for our own physical and mental health. The better you feel internally, the more equipped you will be to handle market fluctuations. Avoid looking at the market/your accounts each day and try to make sure you are taking care of yourself.
I hope you have found these strategies helpful. The actions you take or don’t take in tough market cycles can have a significant impact on your financial future. If we can assist you in any way, please feel free to reach out. www.bmgadvisors.com
~Jennifer E. Malone, CFP® , CMFC-Partner/ LPL Financial Advisor
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Securities and advisory services offered through LPL Financial, a registered investment advisor, Member FINRA/SIPC.