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An Ounce of Prevention is Worth a Pound of Cure: A Life Lesson for Investors Thumbnail

An Ounce of Prevention is Worth a Pound of Cure: A Life Lesson for Investors

I’m an avid runner (if you’ve been around for a while, you already know this). I’m also passionate about helping our clients maintain a long-term focus on their portfolio — encouraging them to treat the process similarly to training for a marathon.

So when an injury took me out shortly before Thanksgiving, I was devastated. Accidents happen, sure. But this was an injury that worsened slowly over time, meaning if I had done things differently while training, I could have prevented it from happening altogether.

I’ve always proudly followed a strict training regimen, especially when I had an upcoming full or half marathon. The problem is, prior to this injury I wasn’t being truthful with myself. I thought stretching and cross-training weren’t necessary in order for me to be a good runner.

I’d always gotten along just fine without them. They would just take up time I could otherwise spend doing what I love (running). In hindsight, neglecting to incorporate these critical components into my training schedule has now cost me more time and anguish than if I had just incorporated them into my routine in the first place.

But what does all this have to do with your portfolio and wealth?

Preparing to Weather a Storm?

I was a good runner even when I wasn’t considering all the components of my physical health, like proper stretching and strength training. I did well, but I certainly wasn’t working to my fullest potential. Worse yet, my narrow sightedness cost me months and months of time away from doing what I love.

I skipped steps that were critical to keeping my body healthy and able to run marathons, or even just run. 

As I reflect on this experience, I can’t help but draw some parallels between training for a marathon and preparing your portfolio and financial life to weather any storm.

Between 2009 and 2020, investors enjoyed the longest-running bull market in history. Then, of course, Covid-19 hit and changed everything. But before Covid, it was smooth sailing for investors — especially for those who were new to the markets. They didn’t have to think about the “what ifs” because for 11 years, they didn’t happen.

Good market conditions can lull investors into a false sense of security. Just like how my ability to successfully train for marathons made me feel invincible. But, as I learned from my own experience, things are fine until they aren’t. And when life, or the markets, throw you a curve ball, you need to be prepared to handle them — or risk losing control altogether.

Skipping critical exercises that could have helped me prevent injury is like ignoring the components of your financial life that can help protect you from financial disaster — tax planning, diversification, retirement income planning, you name it.

How Working with an Advisor Helps

So where am I now?

I worked with my orthopedist and physical therapist to identify the issue and design a plan that could get me back to running. As a result of this incident, I also created a new daily schedule that incorporates stretching and core strength at least once a day.

I had to do six weeks of physical therapy, which taught me a lot and helped me gain back a lot of the strength and flexibility that I thought I had lost. Now, I’m happy to report that I’m back to running my regular pre-injury routine without pain. I may not be able to do a marathon this year, but in 2024 I have my sights set on running a full marathon and, better yet, qualifying for Boston! I’m confident I’ll achieve this goal because I have a much better appreciation for what must be done. 

Just as I was unaware of the unnecessary risks I was putting on my body, and perhaps even not reaching my full potential, there are things investors may not know about protecting their wealth. When you don’t know what you don’t know, it’s possible to miss some strategies and proactive measures that could put you in a much better position to outlast future volatility.

I had to work with a team of health professionals to get back into tip-top shape, and building long-term wealth is no different. You need to surround yourself with a team of knowledgeable experts who can examine your financial life from all angles and build a plan that puts you and your portfolio in a much better position.

A financial advisor can help you address some of your biggest questions including:

  • Am I taking advantage of all applicable tax-saving opportunities, like tax-loss harvesting?
  • Am I diversified enough?
  • Am I on the most cost-effective path to investing?
  • Does my portfolio reflect my tolerance for risk?
  • Am I prepared to cover upcoming expenses like paying for college or buying a house?
  • Is my retirement savings enough to last me through retirement?

Don’t get me wrong, you should be proud of the success you’ve found so far as an investor, especially if you’ve been going it alone. But as an athlete, I know there’s a big difference between being good at what you do and performing to your fullest potential. When you work with a financial advisor, you have the immense advantage of transforming your investment portfolio into a robust, all-weather wealth builder. 

Melissa Sotudeh

Director of Advisory Services