Uncertainty? Trust the Process June 12, 2018
by Jeffery V. Wright, CFA
One of the biggest concerns when it comes to one’s financial and investment goals is the uncertainty around accomplishing those goals, be it retirement, estate transfer, philanthropy, or otherwise. It can be difficult to predict financial market returns, the tax code, or many other factors of life, and these uncertainties can often breed anxiety when saving and investing for those goals. Deciding what to do and how to invest in an unpredictable world can seem like a stressful task, indeed.
The thing is, anxiety and stress are the result of feeling out of control. One important aspect of planning, saving, and investing for retirement is to have a defined process and plan to follow. We can’t control the markets and other factors, but we can control our strategy and behaviors. Having a defined plan gives us actionable behaviors with which we can minimize the sense of lack of control. In essence, have a process. And trust the process.
A solid process should align your risk profile with your objectives. We can’t control what happens in the world, but we can identify the amount of risk we are willing and able to take. Additionally, identifying long-term objectives allows investors to look beyond those current factors that seem uncontrollable and focus on the process itself. Understanding that risk and return are correlated, we can mitigate risk in the context of risk tolerance and desired returns.
The cornerstone of an investment strategy is to set the conditions to maximize the probability of success without bearing too much risk. That is control for an investor, and that is a process you can trust.
At NovaPoint Capital, we implement a repeatable process that measures and quantifies an investor’s risk profile, so we can tailor a risk-appropriate, professionally managed investment portfolio with the objective of meeting goals. Along with the right financial plan, which takes into consideration trust and estate planning, taxes, and personal budgeting, our clients have quite a bit of control by way of a professional investment process.
While external factors influence outcomes, we can prepare and position properly amidst uncertainty. If we do this, we have control, so we don’t have to be unnecessarily anxious. Keep control, trust the process.
Jeffery V. Wright, CFA
Managing Director, NovaPoint Capital LLC
While NovaPoint Capital uses reasonable efforts to include accurate and up-to-date information in this post, errors or omissions sometimes occur. NovaPoint Capital makes no warranties or representations as to the accuracy of this post. Opinions herein are subject to change without notice.0