Article Date: 12/1/2008

Heading North For Expert Advice

Heading North For Expert Advice

Yes, the economy is heading south but that doesn't mean we have to follow.

Jim Thomas

My financial advisor, Larry, recently quizzed me about my financial goals. I told him: savings for retirement and college money for the kids. When he reminded me that economic conditions have changed, I replied that my needs — retirement and college — haven't. He then asked me to fill out a "risk assessment questionnaire," or RAQ, which would reveal how much risk I was willing to tolerate. I returned it unanswered.

"What will this tell you?" I asked. "Isn't it enough to know that I am willing to face risk for my goals."

"Ah, but how much risk?" Larry asked. "Would you rob a bank?"

If I said yes, he'd probably sell me shares in a fund that invests in bank robbery, I said to myself.

My problem was that the one person who should have inspired confidence and motivation in me to stay the course was wilting before my eyes. I had enough. It was time for straight talk. It was time to visit a higher authority.

Heading to the workshop

It had been some time since we last met, but I knew where to find him. I braved the elements: bad weather; a crowded mall parking lot; ill-mannered shoppers; a line of screaming kids; fake snow and elves. I then waited in line until finally, I stood in the doorway of Santa's workshop.

"Ho ho ho! Hey, where's your kid?" he asked.

"No kid today, Santa. This one's for me," I replied. I sat on his lap.

"Ouch!" he blurted. Then we smiled for the camera.

"What would you like? How about a new jacket — one that fits?" he asked.

"No, I need advice," I said.

"Sure. If you buy the TV and the golf clubs, you'll be sleeping alone on the couch," he said.

"No, no," I replied. "I need financial advice. I'm thinking that even though we're facing tough times, we need to invest now for the good times that will surely come. Wouldn't that instill the confidence we need?"

Santa pondered the question. An elf approached.

"There's a special on the photo magnets and snow globes, but I recommend the ‘Memories for a Lifetime’ package," he said. "It's only $115. That's a $35 savings!"

Santa leaned forward. "So you want to continue investing, full speed ahead?" he asked. "Interesting perspective. I don't think it's necessarily right or wrong … It really depends on how much risk you're willing to tolerate, doesn't it?" OM

On behalf of the OM staff, may you enjoy peace and happiness this holiday season, without the risk.

Optometric Management, Issue: December 2008