A Lifeboat Drill for Investors

A Lifeboat Drill for Investors

March 09, 2018
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Experienced investors use “lifeboat drill” skills learned from the cruise ship industry. Just like the ship’s passengers and staff, investors have a plan for their trip. Part of the plan is thinking about what could go wrong and practicing how everyone will behave if something does.

The stock market’s been strong, the bond market’s been good, employment is high and inflation is low.* The best and the brightest don’t see any icebergs ahead, so . . . what could go wrong?!?!

Here’s the drill

  • Start with your Plan:

          What are your goals?          

          Where do you need to go?

          How long do you have to get there?

          Assess your risk tolerance.

  • Think of your “What Ifs.” For example,

    What if…

    the stock market goes down...

    the bond market goes down...

    the dollar goes down...

    interest rates go up...

    the geo-political situation changes...

    ...how will I react?

  • Review your Plan. Do I need to adjust?

Run the drill now to prepare

How you react to the unexpected could have a profound effect on the success of your long-term goals. Reviewing your plan now will benefit you should you find rough waters later.

If you haven’t done so recently, contact your financial advisor and run through a “lifeboat drill.” Ask questions and discuss your plan together, as you sail on towards your financial goals.

Important Information

*Although past results don’t guarantee future results, keep in mind past downturns have been temporary.

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