The following post is an excerpt adapted from a letter sent to my financial advisory clients in April 2020.

“In preparing for battle, I have always found that plans are useless, but planning is indispensable.”

— Dwight D. Eisenhower

We always knew it would happen, and yet, we never imagined it would be like this.

Through the conversations we’ve had the past couple of months, I’ve heard many investors express some version of that sentiment.

Here’s the good news:

We have always planned for bear markets and recessions.
Long-term investors do not need stocks to go up every year to be successful.
Our portfolio asset mixes have not only lived through past market crashes but have—without fail—climbed back to reach new highs.

Without knowing the day, the cause, or the severity, we’ve always known a market drop—even a severe crash—could come at any time, but is this time different?

With the combined health and financial crises, these feel like uncharted waters; however, long-term bets against the markets and U.S. economy have consistently proven to be losers. As investors saw signs of success in attempts to flatten the Coronavirus curve, as well as the extent to which the government is willing to go to backstop the economy, markets rose. While many things in life may be different for a long time, if we are able to phase back into “normalcy” relatively quickly, an energetic recovery may be possible. The longer we are stalled out, the longer it will take to spark the economy, gain traction, and climb out.

What’s the Plan Now?

First, check to see that everyone is okay.

For anyone working and in a wealth accumulation phase, we’d like to hear your current thoughts regarding your job security and any potential income fluctuations. In some cases, adjusting plans for income disruptions may be warranted. Please let us know if you expect a major change in your earnings.

Retirees in a wealth distribution phase may be wondering if they need to decrease their account withdrawals. At this point, investment returns are well within our normal planning parameters and do not indicate that change is needed. In meetings, we will continue to work with you to update retirement distribution plans, which will provide an early indicator if portfolio spending should be adjusted downward.

Second, conduct a strengths and weaknesses assessment.

The recent SECURE and CARES Acts are offering several interesting new financial planning possibilities that we will evaluate on a case-by-case situation.

Investments have climbed back significantly from their initial Coronavirus shock, but with the economy put into a medically-induced coma, we have concerns about how “The Great Suppression” will affect certain assets. Our Real Estate Investment Trust (REIT) allocation may see a downward tactical weighting shift, and we are reviewing the quality of holdings within bond fund managers. Dollars earmarked for the long-long-haul may be used to selectively bargain hunt.

If you’d like more of my thoughts on the market over the past couple of months, please check out some of my other blog posts or give me a call anytime.