Can you tell me how your investment portfolio performed last year? Don’t worry, this isn’t a trick question.
Some of you will probably answer that your holdings were up X% from the previous year or that you outperformed the stock market. That is one way to assess your investment success but, in my view, it’s not the right way.
There’s no surefire method to “beat” Wall Street, despite what some so-called experts may say. If that were the case, we’d all be lined up outside their door!
The financial markets in this country have had dramatic swings over the past few years. If you were counting on a guaranteed return over time, you may have been disappointed, or worse, dramatically impacted if the losses in your portfolio were significant.
Since you cannot control the timing of either the market or your returns, you have to have an overall strategy to make the most of your life. You cannot count on guaranteed investment returns over an extended period of time.
That said, there’s a valuable financial tool—we call it a Nest Egg Stress Test®—that takes into account timing risk and helps you plan for it.
This tool shows you that your holdings depend on not just returns, but also the order in which you receive them and whether you’re adding to your portfolio and when you’re withdrawing from it.
Contact us to learn more about tools and strategies, like the Nest Egg Stress Test®, that can help you track your portfolio.