In this week’s episode, Josh and Austin are giving you all the tips on how to build a bulletproof 2022 portfolio! They talk through hypothetical scenarios surrounding inflation, the US Dollar, emerging markets, the midterm elections, corporate tax rates, and COVID-19 – one of the most informative episodes to date. Tune in now to find the key to a perfect portfolio!
Please forgive any audio irregularities. There were some technical difficulties while recording.
Main Talking Points
[1:47] – Inflation
[4:24] – What if Inflation Slows?
[7:08] – U.S. Dollar Comparison
[9:19] – Emerging Markets
[10:46] – Dad Joke of the Week
[12:04] – Midterms
[14:36] – COVID-19
[15:59] – The U.S. Economy
[18:53] – Corporate Tax Rates
[22:40] – How to Build a 2022 Perfect Portfolio
[24:20] – Rebalancing
Links & Resources
Invest With Us – The Invested Dads
Free Guide: 8 Timeless Principles of Investing
Social Media
Full Transcript
Intro:
Welcome to The Invested Dads Podcast, simplifying financial topics so that you can take action and make your financial situation better. Helping you to understand the current world of financial planning and investments, here are your hosts Josh Robb and Austin Wilson.
Austin Wilson:
All right. Hey, hey, hey. Welcome back to The Invested Dad’s Podcast, the podcast where we take you on a journey to better your financial future. Today, we’re giving you all the tips on building the perfect bullet proof 2022 portfolio.
Josh Robb:
Oh boy, my compliance here are ringing. Are you sure we’re able to do this?
Austin Wilson:
No, but chief compliance officer Josh, this is what I’m going to say to cover ourselves. Nothing we talk about in this episode is a recommendation. Please talk to your advisor before making any investment decisions. Each investor’s situation, it’s completely different. But I’ve covered us.
Josh Robb:
I feel better now.
Austin Wilson:
We’re good now. Yes. So yeah, that’s what we’re doing.
Josh Robb:
All right. So we know exactly what’s going to happen this year. Don’t we?
Austin Wilson:
I do.
Josh Robb:
Yes.
Austin Wilson:
You don’t.
Josh Robb:
I do.
Austin Wilson:
No. Yeah. So actually I don’t even know that. You don’t know that. No investment professional does, and really, if anyone claims that they do, you should probably run away from them because they are very much trying to take their money.
Josh Robb:
Yes. A better approach to that is in order to be a bulk proof portfolio for 2022, we just need to look at some potential situations and talk through them. All right. So I’m going to throw out some hypothetical scenarios, some questions, and then you give me your portfolio thoughts on if something like this would happen. What you think or you suggest would be a beneficial allocation.
Austin Wilson:
Absolutely.
Josh Robb:
Nothing here’s a recommendation. Just throw through some hypothetical scenarios.
Austin Wilson:
Okay. Let’s go.
[1:47] – Inflation
Josh Robb:
Let’s start with inflation because that’s been in the news.
Austin Wilson:
Seven-
Josh Robb:
We have-
Austin Wilson:
… Handle.
Josh Robb:
Yes. 7%. And that’s the biggest we’ve seen since-
Austin Wilson:
Almost 40 years now.
Josh Robb:
40 years. Okay.
Austin Wilson:
’82. I think.
Josh Robb:
Man.
Austin Wilson:
Even older than you .
Josh Robb:
Older than me. Let’s start with inflation being high where it’s been. So we saw 7% last year. What if inflation stays up? What do you got?
Austin Wilson:
Okay. Yeah. So bond prices are going to fall because people are going to sell them. So speaking of fixed income in general, it’s fixed income. That’s what it is. Well a fixed level of income during an inflationary environment, very unattractive, right?
Josh Robb:
Because if I’m getting a set payment of, let’s say 2% and inflation is seven, I’m losing some of…
Austin Wilson:
Your purchasing power goes down. You’re not even covering your in the increasing costs. Yes. So this is what’s causing rates to rise, the selling of bonds because the price goes down, right?
Josh Robb:
And the inverse, right?
Austin Wilson:
Yes. It’s an inverse. So bonds in general and an inflationary environment are going to do poorly that on a price per price. Although they’re less volatile in stocks, they still will do rather poorly and comparatively poorly. So stocks flipping the page that are going to do well in an inflationary environment. I’m thinking of specifically financials. So banks specifically are going to earn more interest income, but also really any company that has pricing power to pass along price increases as their cost is going to increase is going to be something that’s going to do well as well. Materials companies are ones that come to mind. So if they’re in the materials business, they’re receiving cost increases. It’s just understood that they’re going to be able to pass that along. Oil companies are in a similar situation, but also companies with a clear or perceived niche or advantage there. So I’m thinking like Apple and iPhones is one example. They could increase their iPhone cost by $50 and okay. People are still going to buy them. Tesla is the same thing. They could put a couple extra thousand on the price of a Model S, and is really anyone going to complain? Probably not.
Google. Google can increase advertising costs because they own the advertising world. So those companies with the advantages I think are going to be not really too disadvantaged in an inflationary environment. Consumers aren’t necessarily even going to pay a… Or they’re not even going to worry about paying a slightly higher price on things that they really, really love. So, that’s a key there. I also think of companies that don’t have a great deal of cost of good sold. So like software companies. Their costs are really going up all that much. Maybe on the labor side a little bit.
Josh Robb:
So service industries.
Austin Wilson:
Exactly. So they may have some margin by buffer there to do okay.
Josh Robb:
Okay.
Austin Wilson:
All right.
[4:24] – What if Inflation Slows?
Josh Robb:
So what if it would go the other way? Inflation slows, goes down-
Austin Wilson:
So it cools.
Josh Robb:
Yes.
Austin Wilson:
Little hot right now. See if it cools a little bit. Well, bonds are going to become relatively more attractive. So I mean people are going to buy bonds because the fixed nature of that income, it’s not going to be as bad in a low inflation environment. Especially if you get to the point where those yields get to be at or above inflation as they had been for a while that all of a sudden becomes on the table as an option. So this is actually going to cause interest rates to fall and then bonds may generate some positive return. Now that’s on a price basis. Now if you had factor in yield, that’s even more.
Josh Robb:
Now last year bonds kind of general bond market was down.
Austin Wilson:
Yes. Because rates fell.
Josh Robb:
It happened, that you said. Yeah.
Austin Wilson:
Yep. So flip the page to stocks as well. Inflation cooling. So when interest rates fall, that’s generally speaking. Okay for stocks, it’s pretty good for stocks. This is because interest rates are generally used as the discount rates for future earnings, dividends, cash flows and the lower that rate, the more the future earnings are worth and the more that people are willing to pay for them. So while low and falling rates are good for stocks in general, they’re even better for growth stocks. So I’m thinking of things like tech. Tech is something that should do really well because they’re a little bit growth here in this environment. Any high, multiple growth stocks are going to be more favored in a falling or low interest rate world, but it is going to be worse for things like financials because the interest they earn on that interest income is going to be lower. Even energy is a lower multiple kind of part of the market. It’s going to be less favorable than a fulling rate environment.
Josh Robb:
And I always get confused on these things as I think through. Is inflation a leading indicator for the economy or a lagging indicator? I don’t remember. But the reason I’m asking is, you’re talking about some of these sectors doing well or not doing well. Well I’m wondering by the time you find out what inflation is, because that’s delayed. I know that report is delayed. You’ve already had whatever happened to these companies. So it’s not like you can try to play this ahead of time because by the time to tell you what inflation is, you’ve already experienced whatever that was.
Austin Wilson:
It’s a little bit lagging. So this is really if you think very strongly or you feel really strongly that inflation’s going be really hot or really cool-
Josh Robb:
That’s where you-
Austin Wilson:
Far enough ahead, that is where you would make your position so that you capture that. But we just got not that long ago, a month before that’s inflation readings. And by the time you get that, it’s two months out from when it actually happened.
Josh Robb:
You can’t really react to it.
Austin Wilson:
Exactly.
Josh Robb:
Okay. Got you.
Austin Wilson:
So this is not necessarily a time to be reactionary.
Josh Robb:
But these are what could happen based on those two things.
Austin Wilson:
Exactly. So yeah, that’s kind of what I think about inflation.
[7:08] – U.S. Dollar Comparison
Josh Robb:
Let’s move on to the US dollar. So, sometimes the dollar in comparison to other currencies can go up or down in value. So if the dollar strengthens what’ve we got?
Austin Wilson:
So yes, if the dollar strengthens relative to… We usually use the DXY basket of dollar. It’s compared to a basket of other currencies relative to dollar. So if the dollar strengthens compared to the other basket of currencies that could be due to rising interest rates causing US investment to be more attractive, our economic recovery being perceived to stronger than others. If that happens, then international stocks, international equities are going to continue to face a headwind because our stock dollar’s pretty strong right now as that strong dollar makes profits and sales translated into their home currency from dollars worth less. So that’s not good for international stocks, a strong dollar.
Josh Robb:
And then flip it-
Austin Wilson:
Inverse-
Josh Robb:
… Weaker dollar.
Austin Wilson:
So weaker dollar could be due to following interest rates, slowing US growth. That would be actually a tailwind for international equities because that foreign revenue is actually worth more the dollar revenue is worth more when converted back to the nominal currency.
Josh Robb:
And what we’ve been experiencing, like you said, is a strong dollar-
Austin Wilson:
We’ve had a strong dollar, yeah.
Josh Robb:
-strengthening over a handful of years.
Austin Wilson:
And that’s been something that’s been a headwind for international stocks. And I think every year of someone is always like, “Hey, this is the year for internationals, for the US.
Josh Robb:
Your bet last year was that emerging markets and international to do-
Austin Wilson:
Did that happen? No.
Josh Robb:
It did not.
Austin Wilson:
It was not good.
Josh Robb:
Because…
Austin Wilson:
Well EM is a whole ‘nother topic and we’re going to get to that. But the dollar strengthening has played a factor in them. If you look at specifically international developed stocks, they do trade at a comparatively cheap valuation.
Josh Robb:
Yes.
Austin Wilson:
So what you’re getting for what you’re paying is much cheaper than it is in the US. They’re in very different economic situations over there, different growth situations. But the value investor in some people says, “Oh man, it’s the year for international because they’re so cheap.” But we’ve been saying that for a long time and the US has continued to outperform international. So at some point that will ring true. At some point we just don’t know when.
[9:19] – Emerging Markets
Josh Robb:
Yeah. All right. You mentioned emerging markets. So what about emerging markets when it comes to building this portfolio?
Austin Wilson:
Well, there’s a lot of uncertainties and much of it is actually tied to current or to COVID response. So COVID zero policies are terrible for growth. So China has had a notable COVID zero policy.
Josh Robb:
So they went from COVID-19 to COVID zero. They just took all the numbers off.
Austin Wilson:
Took it off the table.
Josh Robb:
All the numbers are-
Austin Wilson:
Yeah. So their COVID zero policy pretty much says they’re shutting down cities and areas of the economy.
Josh Robb:
No COVID.
Austin Wilson:
If you get like one test, you’re shutting down a port, which is terrible. So that is weighing on China’s growth. And China’s the biggest part of emerging markets in general. I also just have to note the Chinese government has been very oppressive to business and innovation specifically over the last year or so. And that could go either way.
Josh Robb:
Depending on their mood.
Austin Wilson:
It could clamp down worse on things or they could say, “Hey, what we’ve done is really not working. And we need to open things back up again.” It could go either way. There’s a lot of uncertainty there. A kind of flyer in the emerging market world is India. India has almost as many people, not almost, but it’s growing faster than China in terms of people. And they will overtake China in terms of people. They are growing their middle class as well. If they get their COVID response in order that growth is undeniable. But really the play on emerging markets in general, it’s all about growth. If you get the growth that people, you’re going to get the growth in spending eventually once COVID is behind you, but getting COVID behind you seems to be hard.
[10:46] – Dad Joke of the Week
Josh Robb:
Okay. Let’s do a quick break for dad joke of the week.
Austin Wilson:
Ooh, I’m ready.
Josh Robb:
All right, Austin, do you know why I hate elevators?
Austin Wilson:
No, I do not. Because they get stuck all the time.
Josh Robb:
Well that’s around our office. No, but half the time they’re always up to something. The other half, they’re just bringing you down.
Austin Wilson:
Bringing you down, man.
Josh Robb:
I really need to start taking steps to avoid them.
Austin Wilson:
Taking steps to avoid them. That is a good one Josh. Do you take the elevator?
Josh Robb:
I do not. Well, I mean, if it’s a 70 story building, yes, I will. But here on the third floor of our building, I take the stairs.
Austin Wilson:
I think I saw a video that so the tallest building in the world I think is in the UAE, Will Smith took the stairs.
Josh Robb:
Oh wow.
Austin Wilson:
In a video of that. And he went all the way to the top. It was awesome. It was incredible. I mean hundreds of stories or something like that. So woo.
Josh Robb:
Is that the one that, and was that Mission Impossible or something that Tom Cruise repelled off the side of it?
Austin Wilson:
I’ve never seen those movies. I’m not allowed. They’re too violent.
Josh Robb:
Too violent, too scary.
Austin Wilson:
Yeah. So we have a couple more scenarios just to be thinking about things that could happen.
Josh Robb:
Some of these are going to happen!
Austin Wilson:
If you give two options, one of them is going to happen.
[12:04] – Midterms
Josh Robb:
Or midterms. The elections are coming.
Austin Wilson:
It’s going to happen.
Josh Robb:
There’s midterm elections. We don’t know the outcome, but that’s an example. So let’s just start with that midterms.
Austin Wilson:
Okay. Yeah. So three options really, right? So right now, one thing that’s not going to change is that we have a Democrat in the white house.
Josh Robb:
Yes. Not up for election.
Austin Wilson:
That’s not up for election. So that will always remain. So then you have the two sides of Congress, the House of Representatives and the Senate. As of now the Democrats hold the majority of both of those. So you have a D, D, D, Democrat, Democrat, Democrat. The other option is that those three options really both Houses of Congress, the House of Representatives and the Senate can go to the Republicans. Okay.
Josh Robb:
And this is one of those years where it’s physically possible. There are some years just by the number of seats available that you just can’t even flip it, but this is a year where it could go that way.
Austin Wilson:
And if you think about size of majorities, the Democrats majority in both the House and the Senate, specifically the Senate. Both of them quite small, relatively speaking to what they have been in the past for anyone. So it’s very conceivable that at least one, if not both of them flips and that’s not an uncommon thing to happen in a midterm election year because people are all hoping and hollering in for… I guess, the Democrats a couple years ago and then things have changed and maybe people are wanting a little bit more change or a little bit to do things a little bit differently. And that’s just the way it’s working out this year. It could have been flipped the time before, but it’s not uncommon for those to flip in a midterm election year. So the other options are yes, both the House and the Senate go to the Republicans. Republicans could get a majority feasibly there, or you could have a mixture where you’ve got essentially gridlock, right? So the Senate could either remain Democratic and then the House flips Republican or the Senate flips for Republican and the House remains Democratic. And then the best case scenario for stock is going to be gridlock. Gridlock is a good way to have not a ton of change go through. And when you’re specifically thinking about things like tax increases and big social spending plans and all these kind of things, gridlock would be a very good thing for the economy that no big tax increases and stuff would go through. That being said, if both houses went Republican, you still have a Democratic president that would not sign everything. And most things would have a lot of compromise. So no matter what happens, we’re going to have compromise.
Josh Robb:
Yes. And even with how close they’re right now-
Austin Wilson:
They’re still compromising.
[14:36] – COVID-19
Josh Robb:
It’s pretty much gridlock as yeah. So, all right. COVID that’s here, still around. We mentioned what China’s doing.
Austin Wilson:
Everyone has it. Yeah.
Josh Robb:
What do you got thoughts on that for the…
Austin Wilson:
I mean there’s two ways it can go right or three, I guess. What if Omicron is essentially the last major variant, it infects enough people that people get natural immunity and because it’s everywhere. And then we don’t… People are pretty much immune to it for a while anyway. That’s one option. We kind of move past this. We can pretty much move past COVID and the responses that we’ve had to do, not just as the US, but as a world, that’s very bull for a lot of things. Foolish for yields because the economic growth situation would be fine, which is bullish for what we talked about earlier. The financials, the companies pricing power, all of those sort of things. Maybe not necessarily. It’s more bullish for the reopening side of the trade if you think of things like energy, if you think of things like travel, those kind of things would do better in that scenario.
But if another more deadly variant arrives, option B, you’re going the other way. You’re going to slow things back down. Yields are going to go down. It’s better for tech stocks and growth stocks. So that’s kind of two sides of the coin there. The third and more likely option is that you’re going to have something in the middle where we’re still going to be dealing with this for a little bit of time and you’re going to want to have a balance. And I think that’s going to be the key that we’re going to talk about a little bit.
[15:59] – The U.S. Economy
Josh Robb:
Yep. All right. So with that, that has a big impact on the US economy. And so if the US economy growth either slows down or picks up and that’s usually measured by GDP, the gross domestic product. But what do you got on those two scenarios? The US economy either growing quickly or slowing down or being…
Austin Wilson:
Yeah. So if growth picks up, that’s a good thing for yields. Optimism’s going to be high. People are going to be more optimistic about the stock side of things in terms of some yields going up is bad for bonds. Stocks can still do well. I mean yield, rising environment, despite what people say. But again, some of those higher yield areas of the market are going to be more attractive. Some of the more cyclical, the oil, the energy, the financial side of things that take huge swings in economic cycles. Those may still have a ways to run in that scenario. But on the flip side, if growth slows, maybe we got a lot of this. This whole economic cycle could have been compressed and maybe we got three quarters of it in two years. We don’t know. Not every cycle has to be 10, 20 years.
So it could be a little bit shorter and we could see that growth really drop off. Another thing that could happen. And I guess I didn’t even put a note to talk about it, but the Fed. The Fed is going to have a huge impact on this year in general. The Fed could really turn things around quickly in a bad way. They could have what’s called policy error where they are trying to react very quickly and swiftly and aggressively slow inflation, which we talked about earlier and what they could do is, they’re going to taper off their key-
Josh Robb:
Over correct it.
Austin Wilson:
And then they’re going to increase interest rates really quickly. And what they could do is essentially force us into a short term recession to because of all of the… it’s essentially like we’ve addicted our economy and our markets to free and easy money, right?
Josh Robb:
Yep.
Austin Wilson:
And you have to wean it off or else you’re going to have a-
Josh Robb:
A shot.
Austin Wilson:
A shot. And we don’t necessarily want that. Along with that, the Fed in general. So obviously they’ve told us they’re going to be weaning off QE by the end of quarter one essentially is where that the bond purchases are going to be tapered off. So that’s part A. We could feasibly see, they’re saying at least three rate height in 2022, and that’s going to increase interest rates as well.
Josh Robb:
Quarter percent up like-
Austin Wilson:
Correct. That’s three, 25 base points or quarter percent increases at least that could be four. I even heard Jamie Dimon, so CEO of JPMorgan, I don’t know who he is talking about saying he gets see as much as seven.
Josh Robb:
Wow.
Austin Wilson:
Interest rate increases.
Josh Robb:
Do they even meet that often?
Austin Wilson:
That they do monthly. But that would actually, that would something like that would cause some serious market turmoil because the market is pricing in north of three, three and three to four in their range. If you get more than that, then you’re going to start having some serious reevaluations of what’s going on there.
[18:53] – Corporate Tax Rates
Josh Robb:
Okay. And then finally, let’s look at corporate tax rates.
Austin Wilson:
Yeah. So the bill back better agenda is really what is driving discussion on this. It’s the answer of how do we pay for 2 trillion of social spending and infrastructure plan? So the answer was generally speaking tax increases. That’s the lever that politicians have. A lot of the individual tax side of things have pretty much been tabled for now. There’s not a ton of discussion on major changes for that. There’s obviously always going to be from the far left, some discussions on well taxes. And if that’s a wise thing to get them to pay their quote unquote fair share, which no one can ever define.\
Josh Robb:
Right.
Austin Wilson:
But the same kind of discussion goes to corporate tax rises, which corporate tax increases. So corporate taxes are another way to get those greedy corporations. I’m using air quotes to pay their fair share. Air quotes again, because no one can define what a fair share is-
Josh Robb:
Or what a greedy corporation is.
Austin Wilson:
Or what a greedy corporation… Because they’re just abiding by the laws that you’ve already put in place, right? So what tax rate increase would do is just like interest rate increases is essentially going to lower earnings, not just now, but even in the future-
Josh Robb:
Because you’re adding cost.
Austin Wilson:
Because you’re adding cost which is going to make stocks really essentially worth less or make companies have to find ways to offset that increase somewhere else. So that’s not necessarily a good thing that could cause people to lay off employees and we’re already in, we’re in an improving but not perfect labor environment.
So I just don’t think that’s necessarily the wisest thing, but that would put pressure on valuations of stocks. There’s not going to be a corporate tax rate decrease. We’re already at a pretty… We’re in a very middle of the road. So we’re, corporate tax rate in the US 21%, right? 21% is middle of the road globally speaking. And it makes the US an attractive place to do business, but still raise enough money to fund a country, right? We’re not zero corporate income taxes like other countries. We’re not 40% corporate income taxes like some other countries. We’re right in the middle. And we always want the United States to be an attractive place to do business. That’s just, that way that helps our country grow.
Josh Robb:
Yeah. Makes sense.
Austin Wilson:
So there’s a fine balance of paying for things we want to pay for and the right way to do that. So yeah. There’s no really good answer for in tax rate increases.
Josh Robb:
There isn’t.
Austin Wilson:
I think that less is on the table-
Josh Robb:
Than there was-
Austin Wilson:
Than there was last year. So if you sat us down last year in 2021 and said, “Okay, Austin and Josh, are we going to get a tax rate in 2022?” I would’ve said seem likely from a corporate tax rate increase. But that the very slim majority specifically in the Senate, Joe Hansen is the guy who’s coming to my mind here. He’s holding up the show in terms of bill back better agenda, which is causing things like the more progressive policies tax rate increases and things like that to be shelved, so that it could be a passable bill because he is needed to pass it. Yeah. Now it’s things are even more unusual and uncertain in a midterm year because you want to do things to fulfill your things that you said you were going to do when you ran last time, but you don’t to do anything too aggressive that is going to make people not vote for you either.
So politicians that are running for reelection right now are trying to dance across the line bit right now. Yeah. So that is, I mean, what did I say? I said, I don’t know what’s going to happen at all because we have no idea what’s going to happen in three months, six months, 12 months-
Josh Robb:
Tomorrow.
[22:40] – How to Build a 2022 Perfect Portfolio?
Austin Wilson:
A couple years. We know that over time, long time period, the US economy. And therefore the companies in the stock market are going to do well and grow over time. But in the short term, we have no idea what’s going to happen. So Josh, the question is, this boils down to, how do you build a dang bullet proof 2022 perfect portfolio?
Josh Robb:
Well, very simple. There’s a couple things you need to keep in mind. And this is really everything you’ve been saying. You’ve been giving the underlying arguments for this. And giving scenarios and how you can tweak a portfolio may to optimize it through different scenarios. But high level is, you need to be diversified.
Austin Wilson:
Diversified.
Josh Robb:
You need diversification. And all that means is just spreading yourself out among multiple different things that react in different ways. If they all move the same direction, you are not diversified.
Austin Wilson:
Right.
Josh Robb:
And so diversify is huge because no matter what happens, you’ll have something that’ll do well and you’ll have something that’ll probably struggle. That’s a good portfolio.
Austin Wilson:
And what is one way to do that? Well, that is investing in all of the different things we talked about. So you need to invest in growth stocks and value stocks and small cap stocks and international stocks and emerging market stocks. And if your risk tolerance requires it, which is a big asterisks because I’m not super into it. If your risk tolerance requires it even boring bonds.
Josh Robb:
And alternatives like real estate.
Austin Wilson:
Yes. Because what happens is if you do, what’s called dollar cost averaging.
Josh Robb:
Dollar cost averaging.
Austin Wilson:
If you’re investing all the time consistently. So you’re putting out, you’ve got a portfolio, all those things I just mentioned, right? And just hypothetically say they’re all 10%, right? You’re putting in a thousand a month or whatever. Well, you’re putting a hundred dollars a month into each of those things. Or so you’re buying more of things when they’re less expensive and less of things when they’re more expensive and eventually it’s going to smooth your returns.
Josh Robb:
Oh yeah.
[24:20] – Rebalancing
Austin Wilson:
And it’s going to make you diversified over time. Now the key there is to rebalance.
Josh Robb:
Rebalance.
Austin Wilson:
So that’s also a key. So every periodic. So what would your recommendation for rebalancing be?
Josh Robb:
Rebalance as often as you need to stay in line with your plan. And so there’s, a lot of times I wouldn’t do it more than monthly. I like quarterly or somewhere right in that range because monthly is even depending what your costs are too. If you’re in a taxable accout, you’re going to create some gains. You may want to just spread that out a little bit more. But in general, periodic scheduled rebalancing time in the market. At least annually, but quarterly, semi, annually, something along line just to keep you in line and in balance. And if you’re averaging over that time, dollar cost every day-
Austin Wilson:
You won’t to have to rebalance-
Josh Robb:
Yeah it helps that out anyways. I mentioned sticking with the plan. This is the key. The portfolio and your allocation there is one piece of it. But having a plan for your overall financial picture is huge. It allows you a reason to stick with what you’re doing. You have a reason to do what you’re doing. You’re not just throwing darts at a board and hoping you get it right. And then to have a plan, a lot of times working with an advisor. And so here at Hixon Zuercher Capital Management where we both work, we spend a lot of time with that. Wherever you have financial advisor, making sure that together, you agree on a plan and then you set up the best way to help you achieve that.
Austin Wilson:
So it’s all about signaling plan. So as always check out our free gift to you, it’s a brief list of eight principles of timeless investing. These are overarching investment things they’re going to keep you on track, to meet your long term goals. And that’s exactly what we’re talking about today, diversify, rebalance, dollar cost average, and stick to that plan. Check it out. It’s free on our website. Josh, how can people help us grow these podcasts?
Josh Robb:
As always subscribe. Every Thursday, you get a new episode, send directly to you, leave a review on Apple podcast. If you have any questions, thoughts, concerns, shoot us an email at hello@theinvesteddads.com. And then finally, if you know somebody who wanted to know how to build a perfect portfolio-
Austin Wilson:
Perfect.
Josh Robb:
… in 2022, just share this episode.
Austin Wilson:
Alright well until next week, have a great week!
Josh Robb:
Bye.
Outro:
Thank you for listening to The Invested Dads podcast. This episode has ended, but your journey towards a better financial future doesn’t have to. Head over to theinvestedads.com to access all the links and resources mentioned in today’s show. If you enjoyed this episode and we had a positive impact on your life, leave us a review. Click subscribe, and don’t miss the next episode. Josh Robb and Austin Wilson work for Hixon Zuercher Capital Management, all opinions expressed by Josh, Austin or any podcast guest are solely their own opinions and do not reflect the opinions of Hixon Zuercher Capital Management. This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Hixson Zuercher Capital Management may maintain positions in the securities discussed in this podcast. There is no guarantee that the statements, opinions or forecast provided here in will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses, which would reduce returns. Securities investing involves risk, including the potential for loss of principle. There is no assurance that any investment plan or strategy will be successful.
