Does your portfolio exemplify your personal risk tolerance?
18 Questions Blog Series
At von Borstel & Associates, we ask our clients 18 critical questions. The answers to these questions determine how we partner with each client and manage their wealth.
Follow along with us through the 18 Questions Blog Series. You may be surprised by what you discover about yourself and your financial plan!
#5. Does Your Portfolio Exemplify Your Personal Risk Tolerance
Do you know your portfolio is a person? “No,” you say, “It’s just a bunch of stocks, mutual funds, or whatever I have placed in that account.” I beg to differ; your portfolio should be you! It should represent your dreams, your goals, and your future. It’s an appendage of who you are and who you desire to be.
To accurately represent you and who you are, your portfolio has to be bigger than itself. It should almost be your alter ego, a piece of a comprehensive plan that integrates your today, your tomorrow, and the dreams you have for all you love. How does this happen? By intentionally building a plan and a process around you. Your risk tolerance has to be identified, placed in the portfolio carefully, and then allocated appropriately with the probability of success worked in.
Can you answer the following questions?
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Do you truly understand risk tolerance in your portfolio and how that affects your concerns and future?
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Do you understand how that portfolio will probably perform based on its structure?
I’ve had clients who invested money in other areas, only to have it suddenly disappear or become worthless. Can you afford to have that happen with your portfolio? What happens to your dreams, your choices, or your family? Your portfolio encompasses you and all you aspire for in the future.
Risk tolerance is not just a number, and it’s not just a word such as moderate or aggressive. It is you, your future, and all your dreams.
Make sure you understand:
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Your risk tolerance
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How it fits in your plan
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How it represents you
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The performance results it should achieve
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How it will perform in good or bad years
Make sure your portfolio and risk tolerance represent
you and your path to the future!
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Investment advisory services offered through von Borstel & Associates, Inc., an SEC Registered Investment Advisor.
