IWM Advisors, LLC  166 East 61st Street–Suite 6B  New York, NY 10065

917.697.4156 peterculver@iwmnyc.com
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Are You Ready For A Down Market?

Key Steps To Weather A Market Downturn

  1. Check Your Risk Tolerance. No one’s risk tolerance – either financial or psychological – stays the same forever. Any number of changing circumstances – age, health, income – can cause a change. Now is an ideal time to revisit your risk tolerance, and there are excellent tools to help you do this.
  2. Revisit Your Financial Plan. Investments don’t exist in a vacuum, and should be tied to a personal financial plan. If you don’t have a concrete financial plan for the next 5 years, make one. A sound financial plan provides the discipline to work through the market’s ups and downs. If you have a financial plan, revisit all the goals and assumptions to make sure your plan is up to date.
  3. Street Test Your Portfolio. Many financial planning platforms include sophisticated tools to model changing market conditions: a big market drop, higher interest rates, lower rates of return. These tools also allow you to test your current portfolio under 1000’s of hypothetical market scenarios. This allows for a much clearer understanding of how your portfolio is likely to perform in the future.
  4. Beware of “Conventional Wisdom”. A parable of investing is this: “Don’t time the market – stay invested.” Easy to do with someone else’s money; not so easy to do with your own. For those whose circumstances haven’t changed and who don’t need to access their investments soon, staying invested is good advice. But for many others, changing circumstances may dictate a more dynamic approach in the face of a market downturn.
  5. Conclusion. By taking all these steps – checking your risk tolerance, revisiting your financial plan and stress testing your portfolio – you can put yourself in the best position to weather the inevitable market downturn.

IWM Advisors is an independent wealth manager that uses a goals-based approach to make sure that clients meet their financial goals in all market environments. To learn more about our approach, please visit www.iwmnyc.com or call Peter Culver at 917.697.4156.

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