Do you often find yourself stressed about your investments? If so, you’re not alone. Many investors grapple with the anxiety of managing their portfolios. Consider strategies you can use to lower that stress.
Understanding Market Fluctuations
Investors who want to avoid stress frequently seek refuge in low-risk options like bank deposits, thinking it’s a foolproof strategy. However, inflation can erode the value of your money over time, resulting in diminished purchasing power. Similarly, real estate, often considered a safe investment, carries its own risks. From price drops to tenant issues, the complications can be numerous. Remember the 2008 financial crisis caused by the crash in real estate prices? It highlights how quickly seemingly stable investments can deteriorate.
Diversification and Consolidation
One effective way to manage financial stress is by consolidating your assets into a U.S. brokerage account. This provides access to a wide range of investment options including stocks, bonds, mutual funds, and FDIC-insured CDs. Consolidation not only simplifies your investment management but also allows for better oversight and strategic planning.
For those living outside of America, maintaining a U.S. brokerage or retirement (IRA) account can streamline tax and regulatory compliance. Not only that but working with monthly statements in English and investments you understand can also reduce your stress.
Assessing Risk Tolerance
A critical step in reducing investment stress is understanding your risk tolerance. If you are a no-risk personality and you have risky investments, that disconnect may be adding to your financial stress. I have often met investors who mistakenly believe their portfolios are conservative when, in reality, they are heavily exposed to market risks. Regularly reviewing your investments and aligning them with your risk tolerance, current financial situation, and goals are essential.
Turn Financial Stress into Success
Knowledge truly is a powerful tool in managing financial stress. However, navigating the complexities of investments, especially cross-border ones, can be challenging. Not everyone wants to know all the details. If that sounds like you, consider meeting with an experienced financial advisor for support and personalized guidance.
Investing doesn’t have to be a source of anxiety. By consolidating your assets, understanding your risk tolerance, and seeking professional advice, you can achieve a more stable and stress-free investment strategy. For help contact us at profile-financial.com/call.
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 September 17, 2024.