2022 was quite the year. We saw the Federal Reserve raise interest rates rapidly in hopes of combating inflation, major stock and bond indices experience losses, and the mid-term elections occur.
With no shortage of news/headlines, being an investor in 2022 could have been difficult for many. Seeing your investment statements drop in value can cause anxiety, especially since the recent years have been mostly positive for stock investors.
Here are 3 themes from our office to keep in mind as we enter 2023:
Remember the 3 Cs of Communication – Clear, Concise and Consistent. In our opinion, we believe you, as an investor, should feel these themes come across in your conversations with your financial advisor(s). It is important to review annually (at a minimum). If you feel the value-add in your conversations isn’t there, it is probably time for another opinion.
2. Savings Rate
In our opinion, a large part of your success as an investor comes from reviewing your savings rate and adjusting it accordingly on a regular basis. You may have had a jump in income over the years, should you increase what you are investing?
This is why we have careers; folks like us help investors understand how much they should be saving based on goals and income. We also help investors diversify their savings buckets (non-retirement, retirement, etc.). Time horizon is important and it is a major factor in discovering what your savings rate should/could be.
3. Investment Management Fees
It is no secret, you don’t work for free and neither do financial advisors. However, discussions about how you are paying your financial advisor(s) shouldn’t be off limits. Make sure you understand how your advisor is being compensated.
As financial advisors, it is our duty to coach you to a better place financially. We take great pride in working with an established client base; however, we also want folks to understand we are a resource. We are happy to answer any questions you may have about the investment world. In our opinion, an educated investor is the best investor!
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Independent Advisor Alliance, a registered investment advisor. Independent Advisor Alliance and Marzano Capital Group are separate entities from LPL Financial.