Could the 2016 presidential election affect your portfolio?
Q. How much do I need to worry about the presidential election and my stocks? Should I go to cash until the “uncertainty” is over?
A. The one constant in the stock market is there is always uncertainty. Always!
There’s always something that will spook the markets, from wars to presidential elections. You can’t let it get to you, advisors say.
“If you listen to the talking heads on television, you will go nuts, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown. “One will predict what will happen to the markets if Hillary is elected. Another will predict what will happen if Donald gets in.”
Then if you switch the channel, Kiely said, two more people will over their predictions, which will probably disagree with the first two.
“Pay no attention to the prognosticators,” he said.
Since the beginning of 1950, Kiely said, a $1,000 investment in the S&P 500 stock market index would be worth almost $130,000 today. That is the power of perseverance.
Jerry Lynch, a certified financial planner with JFL Total Wealth Management in Boonton, cites one of his favorite books: Dr. Seuss’ “Oh The Places You’ll Go!” The book talks about the potential we all have.
“In the middle of the book, they talk about what you need to avoid:’the waiting place,'” he said “Waiting for the bus to come or the rain to go. Waiting for a yes or a no. People are just waiting!”
Lynch said if the market drops because of the election, he wouldn’t be overly concerned.
“Even Warren Buffett said that the president does not have that much control,” Lynch said. “Once the market figures that out, everything will be fine.”
Lynch said the key to investing is to remain consistent in your long-term approach.
“When you start thinking short-term, you are not investing. You are speculating,” he said. “When you start waiting for things to happen, you never get anything done. Be consistent,make small changes over time, and always be investing. The tortoise always wins!”
Karin Price Mueller writes the Bamboozled column for The Star-Ledger and she’s the founder of NJMoneyHelp.com. Click here to sign up for the NJMoneyHelp.com weekly e-newsletter. Like NJMoneyHelp.com on Facebook and follow it on Twitter.