Better U

Portfolio Grief - How Do I Deal With This?

Mike Greiner Mike Greiner is the Director of Wealth Management & Planning for Summit Asset Strategies, LLC.  Summit is a fee-only private, international wealth management company located in Bellevue, which specializes in investment management for high net worth individuals and families, 401(k) retirement advisory services, and advanced wealth transfer strategies.

I’m not sure I have the courage to do this, not quite yet. How can I calmly begin to understand the mortality of my investment portfolio in 2008? What really happened? Where do I begin to seek help? For nearly 20 years I had been saving diligently for my retirement and I was well on my way to secure a reasonable retirement lifestyle. 

Then 2008 happened. My portfolio, almost without notice, was cut in half. I was in shock. I couldn’t eat. I had trouble sleeping. I couldn’t even concentrate on my favorite reality TV show. For the past 10 months, I have done nothing proactive to take charge of the situation. I haven’t even opened my monthly statements or called my advisor. The value of my portfolio is now what it was back in 1996. That’s back when a gallon of gas cost $1.23; George Burns was still on TV; Ross Perot became a politician; Dennis Rodman was still a star in the NBA, and a guy named Bernie Madoff was paying investors 1 percent a month. I don’t want to go back. I like the 21st century and I just want to get back on track. Here are some tips if you are feeling the same way:

relax
It’s time to take a deep breath and realize that you are not alone in your grief.  Many others are experiencing the same feelings of financial emptiness and despair. Warren Buffett’s Berkshire Hathaway lost almost 35 percent. How could the investment guru lose all that money? Was he rehearsing for “Dancing with the Stars?” Many others showed up in pain as well; the Fidelity Family of Funds lost 34.9 percent, Janus’ Family lost 40 percent, the conservative American Funds’ Family lost just under 34 percent.

review
Look at your reality. I decided to plunge into my portfolio recovery armed with a huge cup of my favorite coffee. I dove head-first into that stack of unopened monthly statements. You can’t fix problems if you don’t know what they are. Does Dr. Phil do house calls?

rebuild
Now that you know the facts, it’s time to chart your path to financial recovery. Start again with the basics. Identify your comfort level for accepting future risks, as it may have changed. Reconnect with what your primary objective is for your money. Slowly re-acquaint yourself with your investment portfolio. Look at each of your existing positions and assess their investibility. Find an investment advisor who is a better listener than a salesman. Re-establish reasonable guidelines for your future plans, in case another economic tsunami hits us. Talk with someone that you trust and respect to see how they have been dealing with this mess.

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