Bringing Balance to the Risk Tolerance Continuum
When you are making a financial decision, do you intentionally weigh the potential risks and rewards? Is weighing that balance more of a rational or emotional process for you? In other words, do you tend to rely more on facts or on feelings?
For example, when Karla got a promotion at the architectural firm where she is employed, she gave serious consideration to buying a new car. She thought about the practical and emotional rewards of having a new car such as: 1) having a dependable means of transportation, 2) getting better gas mileage, 3) portraying a successful image to her clients, and 4) experiencing the pride and pleasure that comes with owning a new car (there’s nothing like that new car smell!). (more…)
Adding a family member is an exciting time. Decorating the nursery, picking out names, going to baby showers, and attending parenting classes all prepare you for your baby’s arrival home. But with the joy of a new family member comes additional responsibility. A whole lot of it. After all, your child is 100% dependent on you for all his or her needs.
OVERVIEW
Some investors favor a dollar-cost averaging (DCA) approach to deploying their investment capital. Unlike lump-sum investing, in which the full amount of available capital is invested up front, DCA spreads out investment contributions using installments over time. The appeal of DCA is the perception that it helps investors “diversify” the cost of entry into the market, buying shares at prices that fall somewhere between the highs and lows of a fluctuating market. So what are the implications of DCA for investors aiming to generate long-term wealth? 
According to Charles Schwab’s 2020 Modern Wealth Survey, 57 percent of Americans say they or a close family member have been financially impacted by COVID-19. In addition, nearly 15 percent reported being more financially stressed as compared to the end of 2019 before the widespread outbreak, and express concern that their increasing stress might have a lasting effect. 
It is often said that stock prices take the stairs up and the elevator down. In the first half of 2020, we saw how fast that elevator ride down could be. In just two months, U.S. stocks lost effectively years of gains. In fact, this was the fastest decline of 30% or more that we’ve ever experienced.
As events this year have reminded us, uncertainty is always a factor when it comes to the economy and markets. It’s also a common companion in other areas of our lives, often with real financial ramifications in those instances as well. But you have a plan for that. It’s built with an eye toward managing those inevitable uncertainties and controlling what you can. Importantly, it should include a wealth transfer component designed to achieve the legacy you envision while providing for your loved ones in the way you intend. So, check off each of the following must-have documents you’ve prepared to solidify your wealth transfer plans. See where you stand. Then consider sharing this list with someone you care about. 
By Alex Kluesner
