Will the Election Results Affect Your Portfolio?

It’s undeniable we’re in the midst of a consequential election. But there’s one place where the outcome on (or after) Nov. 3 might not have much sway at all: your portfolio. Financial advisors have reported fielding concerned calls from clients, wondering how the markets might fare depending on who wins. The answer might surprise you. Stocks will perform pretty much the same no matter who occupies the Oval Office, if history is any guide. Analyses in today’s featured story show the data. Now, that’s not to say we won’t see short-term volatility, especially if we don’t have a clear winner on election night. Markets hate uncertainty. But long-term, you’re best off staying the course and not making any rushed changes in anticipation of a certain result on election night.

This week in our Retire with Money Facebook group, one member said he was five years into retirement and still had trouble spending his nest egg (fortunately, he didn’t need to touch it much due to Social Security and a secure pension). “Anyone else having trouble breaking loose with the money?” he asked. This is a common issue — it’s hard to flip the switch from saving to spending. One member didn’t see it as a problem: “I agree with you, except I don't see it as ‘trouble,’” he wrote, adding that he’d like to die with plenty left over. Others mentioned the need to save conservatively for potentially large long-term care costs at the end of life. But if the member wants to enjoy retirement more, and is afraid to touch money that might help him do that, I’d encourage him to see a financial advisor. A financial professional can run projections and give you permission to spend, if it’s warranted. Just make sure your advisor is a fiduciary, meaning s/he is required to put your interests first.

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