Did the outcome of the election make you really happy and excited? Or did it leave you concerned, especially when it comes to your investments? Either way, you shouldn’t play politics with your portfolio. Why? Because investing when only a specific political party is in the White House would have led to substantially less growth over time.
$10,000 invested only when there’s a Republican president would have grown to $100,191 since 1900. Doing the same when only a Democrat is president would have led to the same $10,000 growing to $429,526. While it may be tempting to run to the conclusion that investing only when a Democrat is in the White House is the way to go, the fact is that remaining invested regardless of which party is in control would have led to that $10,000 growing to a mind boggling $4.3 million. That is over 10 times more than investing just when a Democrat is president and nearly 43 times better than investing just during Republican administrations.
While things might seem quite scary when your candidate or party loses; making investment decisions based on politics is a recipe for massive underperformance and having substantially less in and during retirement. The key is to create a portfolio and plan that alleviates fear and concern regardless of what is happening in politics, the market, or the economy by making sure you’re going to be successful and have the income you want and need in any scenario.
This is exactly what we help people do at The Retirement Team, because no one should spend their retirement worrying rather than enjoying it and making memories. There are elections every 2 years. Spending half your time (every other year) concerned about how that year’s outcome may impact your money is a surefire way to not live a relaxing retirement. Nearly every unsuccessful investor we’ve ever seen is one that reacts to current events, while nearly every successful investor is one continuously acting on a plan.
If you’d like help setting up a plan that allows for a worry free retirement where you won’t have the need to react to current events, like elections, our firm is here to help.
Ryan, a financial advisor in Topeka, can be contacted at 785-228-0222 or RetireTopeka.com