Don\u2019t let current global uncertainties\u00a0affect your financial planning<\/p>\n
It’s important not to let current global uncertainties affect your financial planning for the years ahead. People who stop their investment planning, particularly during market downturns, often miss out on opportunities to invest at lower prices.<\/p>\n
It\u2019s important to stick to your strategy and keep\u00a0moving ahead consistently by spreading risk\u00a0and growing your wealth for the long term.<\/p>\n
Higher inflation and faster interest\u00a0rate rises<\/strong><\/p>\n At the time of writing this article in February,\u00a0markets had reacted to the signs of faster wage\u00a0growth and a strengthening US economy that\u00a0may lead to higher inflation and faster interest\u00a0rate rises. The global sell-off began following a\u00a0solid US jobs report that fuelled expectations\u00a0that the Federal Reserve would need to raise\u00a0interest rates faster than expected because\u00a0of the strength of the economy. That concern\u00a0prompted the pullback from stocks.<\/p>\n The Bank of England seemed to offer support\u00a0for the view that rates in general are on an\u00a0upward path with a strengthening UK economy,\u00a0meaning interest rates are likely to rise sooner\u00a0than the markets were expecting.<\/p>\n More attractive investment alternatives<\/strong><\/p>\n A government budget proposal announced\u00a0by US lawmakers to raise spending caps\u00a0could also fan inflationary pressures. Rising\u00a0US bond yields are another possible signal of\u00a0higher rates to come, which could impact on\u00a0corporate profits and curb economic activity.\u00a0But at the same time, higher interest rates can\u00a0make investment alternatives to stocks, such\u00a0as bonds, more attractive.<\/p>\n In practice, everyone\u2019s investment goals\u00a0are different. By deciding on your long-term\u00a0financial priorities \u2013 whether it\u2019s funding your\u00a0children\u2019s education or saving enough to be able\u00a0to retire early \u2013 you can avoid being blown off\u00a0course by short-term events.<\/p>\n Investors should focus on long-term horizons<\/strong><\/p>\n Trying to second-guess the impact of events\u00a0such as Brexit or the recent stock market\u00a0correction \u2013 or even attempting to make a\u00a0bet on them \u2013 rarely pays off. Instead,\u00a0investors who focus on long-term horizons\u00a0\u2013 at least five to ten years \u2013 have historically fared much better.<\/p>\n Sensible diversification \u2013 owning a mix of\u00a0assets, including shares, bonds and alternative\u00a0investment such as property \u2013 can help protect\u00a0investors over the long term. When one area of\u00a0a portfolio underperforms, another part should\u00a0provide important protection \u2013 and it\u2019s never too\u00a0early or too late to start taking this considered\u00a0and strategic approach.<\/p>\n Media frenzy<\/strong><\/p>\n Volatility, risk and market declines are a normal\u00a0part of the investing cycle, but the media likes\u00a0drama. Reports will use words that make these\u00a0market fluctuations sound alarming, so be\u00a0cautious about reacting to the unnerving 24\/7\u00a0news cycle.<\/p>\n Stay strategic<\/strong><\/p>\n If you have a well-diversified portfolio, then it\u2019s\u00a0more important than ever to stay the course.\u00a0You have a strategy in place that reflects your\u00a0risk tolerance and timeline, so stay committed.\u00a0However, if you reacted and sold in a previous\u00a0market decline or have not implemented a\u00a0strategic asset allocation, then now is the time to\u00a0have a discussion about your investment options.<\/p>\n Stay calm<\/strong><\/p>\n Be aware of the psychological effect this type\u00a0of volatility has on you as an investor and resist\u00a0the urge to be reactive. The recent decline was\u00a0expected and is coming after financial markets\u00a0as a whole have experienced a historic bull\u00a0phase for close to ten years now.<\/p>\n Stay focused<\/strong><\/p>\n No one knows how severe any market\u00a0turbulence will be or what the market will do\u00a0next. It could be over quickly or linger for a\u00a0while. But no matter what lies ahead, proper\u00a0diversification and perseverance over the long\u00a0term are what\u2019s most important.<\/p>\n It\u2019s about achieving\u00a0a good balance<\/strong><\/p>\n There are many ways that you can invest,\u00a0and while we all want our money to grow,\u00a0it\u2019s important to think about the level of\u00a0risk you might be willing to take with your\u00a0hard-earned money. It\u2019s about achieving\u00a0a good balance. To discuss your future\u00a0investment objectives or review your\u00a0current portfolio, please contact us.<\/p>\n <\/p>\n Don\u2019t let current global uncertainties\u00a0affect your financial planning It’s important not to let current global uncertainties affect your financial planning for the years ahead. People who stop their investment planning, particularly during market downturns, often miss out on opportunities to invest at lower prices. It\u2019s important to stick to your strategy and keep\u00a0moving ahead consistently…<\/p>\n","protected":false},"author":4,"featured_media":2370,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[],"yoast_head":"\nTHE VALUE OF INVESTMENTS\u00a0<\/em>AND INCOME FROM THEM MAY GO\u00a0<\/em>DOWN. YOU MAY NOT GET BACK THE\u00a0<\/em>ORIGINAL AMOUNT INVESTED.\u00a0<\/em>PAST PERFORMANCE IS NOT A RELIABLE\u00a0<\/em>INDICATOR OF FUTURE PERFORMANCE.<\/em><\/h6>\n","protected":false},"excerpt":{"rendered":"