By Tom Sedoric and Casey Snyder

In life, knowing how to grow wealth and keep it are two different skills. While the former means you have to be optimistic and willing to take a risk, the latter requires you to do the exact opposite.

Wealth doesn’t always stick around as long as you want it to, and a single decision can have a staggering and devastating effect. In fact, the Forbes 400 list (which features the wealthiest Americans) has turned over about 20% each decade, on average, for causes that are unrelated to death or transferring money to a family member.

If you’ve already started planning for your future retirement, chances are mitigating risk isn’t a new concept for you. Having a survival mindset goes hand in hand with the diversification of your portfolio. By keeping all your nest eggs in one basket, you’re at a greater risk of losing it all in the ups and downs of the market. 

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So, when creating your plan to grow wealth and keep it, there are four things we believe that you should keep in mind:

1. Focus on Uninterrupted Financial Stability Instead of Big Returns

While stock growth and returns can seem like the more attractive route, having some cash assets on hand can prevent the negative impacts of a desperate, poorly-timed stock sale during a bear market. This conservative mindset may result in more significant returns in the long run than the ones you might get from other big-time winners.

2. Know Planning Can Only Go So Far

Planning ahead is good in theory, but in practice, things rarely ever go, well, according to plan. With so many variables outside of your control, like global pandemics or large-scale financial crises, your plan could be upended at a moment’s notice. In fact, there have been 12 different recessions since World War II. Make sure you’re including room for error (whether that be with frugal budgets or a loose timeline) so that even if things do go wrong, you’ll still be all right.

3. Be Cautiously Optimistic

Things can only go well for so long. Even if it does eventually balance out, there will be some trials and tribulations along the way. This idea should apply to your finances as well. Having some short-term paranoia can help protect you so that you take advantage of long-term optimism. This duality allows you to see the entire picture rather than pieces of the puzzle regarding your financial health.

4. Understand (and Control) Your Spending

You might start feeling like you're rich if all of sudden the stock market pops off and you find yourself with an excess of gain(s). While it might be tempting to use that money on a big purchase you’ve been thinking about, try to curb that enthusiasm if you can. Being able to evaluate your spending decisions in the context of your short, middle, and long-term goals is ultimately what will set you up for success in the future.

Managing Wealth is a Team Effort

When it comes to retirement, knowing ahead of time how to set yourself up to live comfortably is important. There’s no one-size-fits-most plan when it comes to future financial success. Here at the Sedoric Group, our team will take into account your unique circumstances and help set you up for success.

No matter what age you are, the time to begin preparing for retirement is now. If you’re interested in learning more about successful retirement planning, get our free guide here

The Sedoric Group of Steward Partners

Steward Partners Global Advisory
145 Maplewood Avenue, Suite 100
Portsmouth, NH 03801
(Office) 603-427-8870

The views expressed herein are those of the author and do not necessarily reflect the views of Steward Partners or its affiliates. All opinions are subject to change without notice. Neither the information provided nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Past performance is no guarantee of future results.

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Securities and investment advisory services offered through Steward Partners Investment Solutions, LLC, registered broker/dealer, member FINRA/SIPC, and SEC registered investment adviser. Investment Advisory Services may also be offered through Steward Partners Investment Advisory, LLC, an SEC registered investment adviser. Steward Partners Investment Solutions, LLC, Steward Partners Investment Advisory, LLC, and Steward Partners Global Advisory, LLC are affiliates and separately operated.

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