Which Is More Important: Portfolio Performance or Your Financial Plan?

As advisors, our process begins by asking about your financial goals. In most cases, the number one goal is a sustainable retirement in which you have an income that you do not outlive. From there, we want to construct a blueprint for your financial plan that will become our roadmap to help you achieve your goals. With a plan in place, we then build a portfolio of investments that fit the plan. The portfolio can be a mix of stocks, bonds, and alternative investments, in which we will periodically re-balance.

A portfolio is not, by itself, a plan. Therefore, planning is more important than returns; you need goals. A portfolio that is not constructed with your plan in mind is simply speculation. It can have no other objective than to beat the portfolio of your neighbor or your friends.