There’s a lot to worry about this Holiday Season and wealthy households are not immune to these concerns. But let’s be honest. For the most part these are “first world” concerns……and they reflect the fact that overall, most investors are feeling pretty optimistic about the economy as 2017 comes to an end.
We asked investors to rate, using a 100 point scale, their level of concern regarding some “hot topics” currently in the news. These topics included: Healthcare, Tax Reform, North Korea, Iran and Stock Market Conditions. So what were investors the most concerned about?
- Healthcare was identified as the biggest concern for investors as they enter 2017.
- Healthcare was followed closely by North Korea. The Korean leader just recently launched another ICBM missile capable of hitting the mainland of the United States.
- Tax Reform was rated at 62.68, closely following Healthcare and North Korea.
- Stock market conditions were rated as a concern for many investors. This is primarily because they worry about when the market will reach its cap.
- Situation with Iran, while important to more than half of investors is not deemed an imminent threat.
While all of these are issues over which investors have no control, many of them can have an impact on their portfolios. Because of that potential impact, should financial advisors be discussing these issues with their clients?
When asked which of the above issues investors would like to discuss with their advisors, the only one that resonated with investors was Stock Market conditions. And in that instance, only 56% of investors wanted to discuss the stock market conditions with their advisor. The next most common answer was Tax Reform at 20%. Healthcare was 12% and North Korea was only 9%.
If financial advisors are providing true financial planning to their clients, why wouldn’t they want to discuss Healthcare and Tax Reform with their advisors? After all, these are some of the issues that they are the most worried about. Is it because they don’t think their advisor or his/her firm actually has any expertise in these issues? And why don’t they want to discuss the Stock Market with their advisor? Maybe they just don’t want to talk to their advisor?
As Baby Boomers begin to enter retirement, Healthcare will become increasingly important. Similarly, if Tax Reform is enacted, don’t investors need to know how it might impact them and their portfolios?
It’s time for advisors to increase their level of expertise regarding these issues. Obviously, some of these issues are very complex and it would be difficult for an advisor to become an expert in all of these areas. But it’s not outrageous to demand that many of these large financial firms should begin to develop this expertise so that they can truly assist investors with the real issues that they are worried about. Hey, Big Firms…find some Healthcare experts. Learn about the impacts of tax reform. Hey, Little Firms…find some good local referrals to assist your clients!
During this Holiday Season, let’s be thankful that we are allowed to be focusing on how to protect our assets. There are many who live each day trying to protect their lives.
Merry Christmas! Happy Holidays!