Embrace the Bear
With December’s woes in the stock market, I think it is fair to say we are officially in Bear territory. Although nobody likes to see negative returns on their investment portfolio, educated investors know that you can’t have the good without the bad. Just like you can’t have day without night, good news without the possibility of bad news, or happiness without sadness. We encourage you to embrace the bear for the following reasons:

  • You are clients of our firm and as such we/you know that your monthly obligations are met by your pensions, Social Security, and modest withdrawals from your investment accounts.

  • You have insured your pensions with survivor benefits and your life savings and dignity with long term care insurance.

  • Many of you have annuities (fixed, variable, or index) that have retirement benefits and death benefits which provide added security and peace of mind.

  • You have emergency funds tucked away in non-variable investments and have no debt or very manageable good debt.
I entered this business March of 1987 and was promptly greeted with Black Monday on October 19 th . Markets around the world saw the biggest one day drop in history, the Dow Jones finished down 26%, and markets in Australia and Hong Kong were down in excess of 40%! As we began to specialize with federal employees we saw the markets rebound through the 90’s with multiple double-digit return years. The new century and the tech bust along with the terror attack of 2001 saw markets give up almost 50% of their value. Over the next five years the markets and our investments battled their way back to whole, only to lose 50% again in the great recession of 2008. March of 2009 started the latest Bull market which brought the Dow back to 2007 highs and then doubled that! Currently the Dow Jones average would have to lose another 10% just to get back to its value the week before President Trump was elected, this is not panic time.
What I have learned over and over during the past 30 years is that folks who are properly insured and diversified don’t panic, don’t lose sleep, and hold true to their plan. Imagine if your 1 million dollar investment account was your: monthly expense fund, vacation fund, survivor benefit plan, inheritance plan and long term care plan. A drop of 20% or more would cause any sane person to lose sleep and run for the bank account. We simply don’t allow our clients to create such a flawed plan. One of our favorite statements is “Our clients win, they always win, because we stack the deck.” We stack the deck with proper survivor benefit choices, long term care insurance, life insurance and annuities, and active money management. We will live through this together, we will thrive through it together, as long as we stick to the plan.  
Remember we will communicate via the radio show the first and third Tuesdays from 6:00 to 7:00 pm, we will send emails like this, and we can do webinars as often as needed to keep you informed and comfortable. We have suspended the acquisition of new clients (a timely decision) which will allow your advisory team proper time to address your needs and remain fully committed to you.

Thank you, as always, for your trust and confidence.

Michael R. Mason, CFP ® , CLU ®, ChFC ®