Year-End Review, Thoughts

By Jon L. Ten Haagen, CFP ®

The market had a very nice run in 2017, and with the New Year here we should reflect and review.

You’ve likely read in the papers, heard on the news and seen on TV how the “markets” have given you a return of 20 percent and more. Then, you look at your monthly statement for December from your ‘financial advisor’ and see your portfolio return was 13-14 percent. What happened?

Well, if your advisor was doing their job, you had a well-balanced portfolio that provides you with downside protection. This means your portfolio was not only made up of the market stocks, but had other investments, such as CDs, or bonds, to give you income and a cushion for when the markets try to take back your gains. You might want to have a talk with your financial advisor if this has not been the case for 2017 or before.

Either way, you should review your investments because with the markets success your portfolio could be out of balance with too much equity as an overall percentage. This could be caused by the valuation increase in your equity positions. Say you started the year with a balance of 60 percent in equities and 40 percent in fixed income. Now you may have 75 percent in equity and 25 percent in fixed income. It’s great that you have these wonderful gains, but keep in mind that what goes up doesn’t necessarily stay up. At some point, the market will have a ‘correction,’ so you might want to rebalance to lock in some gains – that is to bring your portfolio back into balance.

Sell some of your winners (stocks) that you have held long term and put that gain into fixed income so you are back in balance with 60 percent in stocks and 40 percent in fixed income. This is just an example – you have to feel comfortable with the percentage mix in your portfolio. Take into account that you are a year closer to retirement and you want to make sure you are comfortable with your decisions.

Besides your investment portfolio(s), you should also review your insurance policies to be sure you have the right amount and type of coverage for you and your family’s potential needs. Are you still comfortable with your beneficiary choices? Has there been a life change in the past year? A birth, death, marriage, divorce, inheritance, etc. There may be a need to increase or decrease some of your coverage amounts and change a beneficiary or more.

I, your ‘Ask the Expert’ writer, hope you have enjoyed the columns this year, and appreciate the kind and positive words you have shared with me. We try to point out that the media is there to inform you and education you, however, they are also trying to sell papers and to that effect they can try and make it seem like something you have to react to immediately.

Investing is a long-tern proposition. Buy quality and stay with it as long as it remains quality. Do review periodically with you advisor to make sure you are still on track to reach your goals. Also, remember that goals do change occasionally and you must address them, so be in touch with your advisors periodically.

Today especially you should be talking with your CPA, estate planning attorney and your CFP. With the tax-law changes happening there are areas you must address. Do not sit back and think all will work itself out. Get involved in your future and you do that by talking to your experts whom you are paying to guide you.

I wish you the very best in the New Year and please know I am here to help and guide you. Visit to read about my latest TV appearance, my quotes in various financial publications and my older articles from The Long-Islander, which we post periodically – and are also available at

We are here to help you achieve your goals.

Happy New Year.