Behavioral economist Dan Ariely noted, “The worst mistakes are the ones we let happen to us.” Often, the greatest pitfalls stem not from poor decisions, but from a lack of action. While autopilot has a time and place, Ariely’s insight teaches that inactivity in financial oversight allows problems to fester, which can significantly impact your financial future.
Overwhelmed or Decision Fatigue?
Investing is full of uncertainties. However, a lack of certainty shouldn’t prevent you from making the best possible decision with the facts available. Not deciding to do anything is a decision in and of itself. I met a woman who delayed adjusting her portfolio in reaction to severe market shifts. Her inaction resulted in her having a portfolio that was far too risky for her needs and risk tolerance. She was lucky that we rebalanced her portfolio before the market crashed, so she then had a portfolio that fit her situation much better. For those with cross-border investments, proactive strategies are crucial to navigate market fluctuations, tax laws, and exchange rates.
Take an Active Position
As life progresses, investors shift their focus from wealth accumulation to capital preservation. More conservative investing requires making prudent decisions without unnecessary risks. When you reach a life milestone, whether making aliya, retirement, or a Big Birthday, take the time to review your portfolio and make sure it still meets your needs. I often find that in reviewing new client portfolios, it’s necessary to rebalance positions to maintain comfortable risk levels. By incorporating a blend of different asset classes (stocks, bonds, and bank deposits), we can align investments with financial goals.
You Don’t Need to Do It Alone
If finding the right balance between risk and security seems daunting, consider seeking professional advice. At Profile Investment Services, Ltd., we specialize in helping people in Israel with U.S. investment accounts. Sign up for a complimentary Cross-Border Financial Evaluation at profile-financial.com/call and take an active step towards securing your future.
Let yourself be inspired by Dan Ariely’s vision of proactive decision-making, and don’t let indecision determine your financial legacy. Take control, make informed decisions, and steer your investment journey towards a secure future.
Douglas Goldstein, CFP®️ is the director of Profile Investment Services, Ltd. www.Profile-Financial.com He is a licensed financial professional both in the U.S. and Israel. Call (02) 624-2788 for a consultation on how to set up your American assets to meet your financial goals. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates. Neither PRG nor its affiliates give tax or legal advice.
Published August 14, 2024.