To keep your investment portfolio on target for financial goals, you want to balance risk and diversify your assets. That’s the purpose of asset allocation - the process of dividing your portfolio among major categories like cash, stocks and bonds. Historically, the returns of these three major asset categories have not moved up and down at the same time - so including a mix of these assets in your portfolio can protect against losses. There is no perfect formula for asset allocation - it differs with each individual depending on their risk tolerance and time horizon. Risk tolerance is the amount of your investment you’re willing, or able, to lose in exchange for greater possible returns.  Risk tolerance is closely tied to time horizon, or the amount of time you have to invest. An investor saving to make a down payment on a home in 5 years might choose less risky investments than someone saving for retirement in 20 years. A longer time horizon allows more time to recover from loss. Asset allocation may be one of the most important investment decisions you make with your portfolio - call us today to learn more.

As life expectancy has grown, your retirement now can last between 20 and 30 years. So Social Security planning is critical, no matter how much money you have. It can make a difference of hundreds of thousands of dollars. For example, if you retire at age 62 and pass away at age 86, you’ll receive at least 25% less for 24 years. But, if you wait to retire at age 70, you’ll receive 32% more for 16 years.

If your retirement income at age 66 was $2,000 per month, this could be a difference of over $200,000 during your lifetime. Arriving at a decision on when to retire is not easy. If you retire early, it could affect your spouse’s benefits. And wages and other taxable income could cause up to 85% of your Social Security benefits to be exposed to income taxes. Proper planning takes all of these factors into account to determine a Social Security strategy. For instance, a repositioning of assets could reduce taxable income and provide for more reliable monthly income. With over 500 different combinations of factors affecting benefits, it makes sense to talk to a financial advisor and get it right.