March 2, 2021 | Another Excellent Time To Review Financial Plans and Risk-Exposure

Rob Carrick’s Globe article last week bemoans a “second-opinion desert” for unbiased financial and portfolio reviews.  Noting a few online review services, Carrick concludes they are really designed as “sales promotion” for financial products and services.  That’s true, and it’s unfortunate because, particularly in the present financial mayhem, individuals are badly in need of unbiased, risk-assessments and insight on their holdings, plans and approaches. See What to do if you want feedback on your portfolio.  Here’s the gist:

In a hot stock market like we have now, we’re all genius investors. But realists know the test of smart do-it-yourself investing is to consistently generate the returns you need over long periods of time. If you have doubts about that, a second opinion makes sense.

Unfortunately, our current investing landscape is mostly a second-opinion desert.

…with newbies flooding into DIY investing these days, it’s a done deal that many are riding the wave and not thinking about the future much. A portfolio-health check, simplistic as it is, is better than flying blind into the next market downturn.

Not just do-it-yourselfers (DIYs), those with so-called ‘professional’ broker/fund/portfolio service providers can also benefit from a sober review and assessment.  The trouble is that in an equity culture dominated by product-underwriting, sales, services and firms, second-opinions often leave recipients none-the-wiser.

Even when wise financial counsel is found, many are not receptive and only look to change service-providers and approaches after major loss episodes.  Similar customer-migration patterns happen at the bottom of every cycle.  See this excellent article from The Medium for more insight on today’s mayhem: Everyone wants to get rich, and it’s driving us crazy.

In financial manias, the saying goes that ‘genius is before the fall.’  In real life, proactive review and sober risk management are a ‘genius’ with lasting benefits.

Danielle Park March 2nd, 2021

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