{"id":8226,"date":"2022-06-14T18:15:09","date_gmt":"2022-06-14T23:15:09","guid":{"rendered":"http:\/\/blog.jlbn.net\/?p=8226"},"modified":"2022-06-19T14:46:27","modified_gmt":"2022-06-19T19:46:27","slug":"every-month-i-express-my-concerns-to-my-adviser-but-he-says-not-to-worry-my-401k-has-lost-over-20-and-i-cant-afford-to-lose-that-kind-of-money-is-it-time-to-find-a-new","status":"publish","type":"post","link":"http:\/\/blog.jlbn.net\/?p=8226","title":{"rendered":"\u2018Every month I express my concerns to my adviser, but he says not to worry.\u2019 My 401(k) has lost over 20% and I can\u2019t afford to lose that kind of money. Is it time to find a new adviser?"},"content":{"rendered":"\n

Every month I express my concerns to my adviser, but he says not to worry and that it will bounce back.<\/em><\/strong><\/p>\n\n\n\n

Question:\u00a0<\/strong>My 401(k) was doing ok for a while, but since January of this year it has been losing money that I can no longer afford to lose. I want to retire in a year and my 401(k) has lost over 20% and was not that large to begin with. Every month I express my concerns to my adviser, but he says not to worry and that it will bounce back. I do not see that happening anytime soon. What should I do?<\/p>\n\n\n\n

Answer:<\/strong>\u00a0In general, a 20% loss for someone retiring in a year suggests the account may be invested too aggressively, says certified financial planner Daniel P. Forbes of Forbes Financial Planning, Inc. That said, certified financial planner Grace Yung of Midtown Financial points out that this is a midterm election year and historically, midterm election years are volatile due to uncertainty. \u201cWe have many other factors contributing to the current market action like high inflation, rising interest rates and geopolitical instability,\u201d says Yung.<\/p>\n\n\n\n

So do you need a new financial adviser? Pros say that depends. The first thing would be to have a serious conversation with your current adviser because it seems your investment portfolio may be too aggressive for your willingness to ride out the market\u2019s ups and downs. \u201cInstead of hoping for a bounce-back, the client and adviser should revisit a risk analysis and retirement income forecast to make sure all is on track,\u201d says Forbes.\u00a0 And John Piershale, certified financial planner at John Piershale Wealth Management says: \u201cAsk your adviser for a risk assessment of your portfolio against your risk tolerance and then make any adjustments.\u201d<\/p>\n\n\n\n

For his part, Ian Rea, certified financial planner at Slate Peak Financial Services, says: \u201cIf you\u2019re truly not comfortable with the level of volatility in your portfolio, talk candidly about that with your adviser. You have options beyond just selling everything and taking a permanent loss. Ask your adviser to shift the portfolio to a somewhat more conservative approach,\u201d says Rea. That said, that may mean locking in some losses now.<\/p>\n\n\n\n

One thing the adviser may be doing somewhat right, pros say, is telling you to stay the course. Indeed, Rea says it\u2019s important to keep in mind that you have not yet actually incurred a 20% loss. \u201cThat only happens if you sell. In the meantime, it\u2019s only a decline in value, which can be expected to happen periodically, even for the best investment portfolios,\u201d says Rea. And for his part, Elliot Dole, certified financial planner at Buckingham Strategic Wealth, says no one likes to see their portfolio shrink, but fear-based selling can cause real financial harm. \u201cThat \u2018get me out\u2019 selling may feel good in the short run, but when markets recover and you\u2019re sidelined, you\u2019re facing another difficult decision of when to get back in, now at higher prices,\u201d says Dole.\u00a0<\/p>\n\n\n\n

But it is a bit of a red flag that your adviser may not have been investing your funds in a way that suited your risk tolerance: That\u2019s something he or she should have determined before investing the money. And the adviser also should have shared market expectations with you. \u201cA financial planner needs to set realistic expectations in up and down markets and listen to the clients needs and risk tolerance. In this example, the client seems to be getting nervous and uncomfortable and this can lead to a bad relationship,\u201d says certified financial planner Andrew Feldman of AJ Feldman Financial.\u00a0<\/p>\n\n\n\n

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Every month I express my concerns to my adviser, but he says not to worry and that it will bounce<\/p>\n","protected":false},"author":1,"featured_media":8228,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[254,3421],"tags":[888],"_links":{"self":[{"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/posts\/8226"}],"collection":[{"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8226"}],"version-history":[{"count":1,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/posts\/8226\/revisions"}],"predecessor-version":[{"id":8227,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/posts\/8226\/revisions\/8227"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=\/wp\/v2\/media\/8228"}],"wp:attachment":[{"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8226"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8226"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/blog.jlbn.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8226"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}