As I sit down to write this blog it’s a little after 11 am, and it’s the first time today that I’ve checked to see what the stock market is doing. This morning I was busy preparing for a client meeting that Chip and I have next week and then reviewed trades placed in client accounts yesterday to make sure they executed in good order.
It’s probably surprising to some to learn that we don’t sit and watch the markets move all day long. If I didn’t work in Wealth Management, I’d probably think that being a Financial Advisor involved sitting in a room full of traders watching stock tickers flicker across a screen, waiting for the exact right moment to buy or sell, and in turn making our clients millions of dollars in an instant. My mind instantly goes to scenes from The Wolf of Wall Street and The Big Short. That all sounds very exciting, and it makes for a good motion picture, but the world of Wealth Management is much, much slower than that.
Buying and selling is a part of managing client accounts but having a disciplined process for when to trade and when to hold back prevents us from having to react at a moment’s notice. This allows us to really spend time getting in the weeds when it comes to things like college planning, preparing cash flow statements, and running tax projections for our clients. We’re able to focus on full, holistic financial planning instead of having to keep our finger on the daily pulse of the market. Wealth Management is a long game, we don’t bet our clients’ entire net worth on the daily direction of the market, the risk is too high. Our timeframe isn’t today, it’s our clients’ lifetimes.
I can’t tell you the share price on the hottest growth stocks this year, and I’ll never be able to tell you what a specific sector is going to do. I can tell you that over the long run that markets are positive, that if you stay invested and take appropriate risk that you will eventually be rewarded with positive returns, even if they’re non-linear. It’s a difficult value proposition, I know.
Building and maintaining wealth is something that takes time, a long time. Think of it like watching grass grow, because sometimes it’s just as exciting. There’s no drama and there’s no rushing it. You put down your topsoil, your seed, maybe some straw, water the heck out of it, and pray for sun.