Tips for Asset Allocation in a recession

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Read about three investors Ella, Noah, and Tina. You may spot some similarities between your personality and theirs. Each of them has personality traits and basic beliefs that place them squarely in one investor profile or another, and maybe you do, too. There are benefits to each perspective. read on to see what each investor learned about how they could improve their investing style. . Investing is about balance; how much baked chicken and kale salad or pie and ice cream should be at your meal. 

CONSERVATIVE (sweet): Everyone who knows Ella says she is a worrier. She is uncomfortable with the idea that her investments could lose value, so she has always invested in cash or cash equivalents. She doesn’t earn much on them, but she feels secure knowing they will be there when she needs them.  Her budget is written down on spreadsheet.  She likes to be knowledgeable and prepared and uses lists often.

Investing tip: Ella realized that she is risking that inflation will outpace her earnings. These days, she invests a higher portion of her money a little more aggressively. By spicing up her investments a pinch, just like baking, she knows a little seasoning and time are needed to produce results.

BALANCED: Right down the middle is the way Noah lives his life. He has multiple delivery restaurants on speed dial. A little risk is okay with him, so he enjoys rock climbing on the weekends.  But a lot of risk? He is comfortable taking some risk because he understands that he may get greater rewards for doing so. His investments tend to be in government bonds. Noah uses technology to manage his financial affairs.

Investing tip: Noah learned that taking a middle-of-the-road approach doesn’t necessarily mean putting all his money into bonds. His investments are now spread out among a variety of investments, and he feels more confident that his approach matches both his temperament and his goals.

GROWTH (spicy): Tina loves nothing more than an adrenaline rush. Hot wings are a treat! Extreme sports are in her blood, and she doesn’t sit still for long. When she started investing in 2011, it was because she noticed the stock market increasing; she put all her money into stocks. She gets a thrill every time she looks up what her stock investment returns are. Tina knows how much she spends but has never written out a budget.

Investing tip: Tina decided that she needed to think more about the long-term. Her investments are now diversified. She is still mostly invested in stocks through mutual funds, but she helps hedge her account against wild market swings by also investing in bonds and cash equivalents.  Each month she adds money to her investments automatically to take advantage of buying investments when the prices are on sale.

It is likely Ella, Noah, and Tina will all live longer than their parents due to modern medicine.  Pre and Post retirement looks different for younger generations.  The investing time horizon will need to provide income for more years.  Work with a financial planner to help understand where your allocation should be and planning needs.  Learn to cook up a feast and improve your future comfort and dignity outlook at the same time.


These are a hypothetical examples and are for illustrative purposes only. No specific investments were used in these examples. Actual results will vary.


ShãnSutherland #FinancialAdviser #CertifiedRetirementCounselor® #AccreditedInvestmentFiduciary®  #SimpleImpactLLC #RenoNevada #FeeOnlyFinancialPlanning #BudgetHelp