“Five Year Money!”

For the last few years, I have been suggesting that our WSG client family only entrust assets to our oversight that we refer to as five-year money!

Other than “normal” IRA distributions of interest, dividends or capital gains the investments should be viewed as “future you” money.

The capital markets have had a great run over the last few years, and many have benefitted with positive results in their accounts.  

So, a perfect time for each of us to pause, review our need for any money from our accounts and start a new five-year timeline.

This chart below is from our Broker/Dealer, LPL Financial.  It was in our 10/6/2021 research piece and I am adding this because, once again, it offers a sense of perspective and reality.

Please observe this chart closely, as I have.  If you squint, you will see there were no, none, zip, nada pullbacks that lasted as long as five years in the last 41 years being measured.  That is one reason why I suggest you only invest money you don’t need to touch for at least five years.

 The basics:

• Have no debt wherever possible, even on your home
• Have enough cash on hand that you drift off to sleep at night with greater confidence in your financial situation
• Know your expenses each month
• Know where your money is coming from each month to cover #3 above

And only then invest and systematically add to your investments with a minimum of a five-year timeline.

As always, our team and I are available to discuss this concept with you.  Just call, email or stop by the office and say “Hi”!

Respectfully,

James O. Lunney, CFP®

CERTIFIED FINANCIAL PLANNER™ Professional  

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.  To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing.  Investing involves risk. Loss, including loss of principal, may occur. No strategy assures success or protects against loss. All performance referenced is historical and is no guarantee of future results.  All indices are unmanaged and may not be invested into directly.