If I was CNN, I would call this month the September Slaughter (cue the dramatic music and bold graphics!) with almost all the global markets in 52 week lows, a commodity sell-off and the continuing meltdown of the housing chain in the U.S. (from retail pricing to financing- look on the bright side, the other shoe may have dropped finally). It is not a good time to be a short-term investor but a good time to start looking for bargains.
I have a lot of favorite sayings in life and one of them is you truly judge a person when things are down and not up. Thus, the question becomes where is your financial advisor, financial planner or money-person during all of this?
If they are silent or, worse yet, advising you sell stocks losing money, perhaps its time to consider that your financial planner, advisor or money-person is a Johnny good-times only type of advisor who will dump or ignore you at the first sign of trouble or is only looking out for themselves by trying to make the short term buck by earning commissions on a trade that only benefits them.
Think of your financial planner or advisor as you think of your boyfriend or girlfriend. The bad ones abandoned you at the first sign of trouble or, even when things were going sideways in your life, every sentence continued to start with the variation of “I want”. All my married friends tell me they don’t deserve their spouse which I translate to mean even when the chips are down, their spouse is there.
Even the most hardy and savvy of investors need reassuring sometimes. That is what a good advisor does. They explain why things are happening, what should be done (and doing nothing is an action) and to stay the course on a prudent investment strategy. If need be, they show the charts, do the power-point, pull out the Buffet-isms. But, basically, they make sure we don’t have a melt-down and do something stupid. A good advisor makes those calls even if they are not getting a trade out of it.
What is your advisor say?
September 11th, 2008 at 9:51 am
Our guy is quiet just at the moment, but we’ve been moving to self-directed investments this year. On the bright side, he did call about two months ago to say we’d be seeing a dip in our portfolios, and invited us to come see him. We appreciated the call – it’s a hard one to make.
September 11th, 2008 at 5:12 pm
A good analyst would have seen these dips months ahead of time and recommended moving you into investments with sustainable results.
The stuff that’s been going on in the financial world has been highlighted for months in the alternative press.
There is a lot to be said about the sources of financial information you use to drive investments. Mainstream news feeds begets mainstream results. << good topic of discussion
September 11th, 2008 at 10:00 pm
Great post!
Everything I do is DIY, but I have more than a few friends who have received advice recently from their “money advisors” to sell funds and buy other ones with even high MER’s. I’ve given the advice that they should FIRE each and every one of them and take a list I wrote some time ago on their shopping trip for a new advisor.
When everyone looks to be at its worst, I’m usually thinking NOW is the time that I want to start buying.
September 12th, 2008 at 10:14 am
I’m an advisor and I send out a e-newsletter each month to keep clients informed. I’ve contacted a few others by mail or phone to touch base as well. Surprisingly, few are in panic mode just yet.
September 12th, 2008 at 2:20 pm
I tend to have my own self-directed brokerage account. I only try to rely on a broker or ‘money advisor’ if there is a structural change to an organization that I have shares with that may require clarification.
If you are a person that feels the need to have one, than that’s perfectly fine. Personally, I despise having to pay for these types of services, as well as any MERs that are required upon purchasing mutual funds – which is why I tend to stay waaaay clear from them as well.
Cheers
The Rat
October 19th, 2008 at 10:46 pm
I’ve got two investment advisors. One has been sending emails almost every week. The other must think silence is golden — not a peep.