You may not be on the billionaire's list...at least not yet...but that doesn't mean there isn't a lot you can do between now and the end of December to lock in the gains made during this year's bull market, and to make sure that 2018 really is a happy new year, News Radio 1200 WOAI reports.
Scott McMillian, who is the Chairman of San Antonio's Sendero Wealth Management, says, while the change in the year is a random act to the markets, it is a good opportunity for all investors, whether you manage a seven figure portfolio or a 401(k) to make sure you are well positioned.
"Making sure that you know what 2018 looks like from a cash-in and a cash-out situation, and also making sure you know where your investment allocation sits, relative to your long term goals," he said.
McMillian says regular working adults have a lot more control over their financial planning than many realize. For example, unlike the traditional defined-benefit pension, which has pretty much been phased out for private sector employees, the 401(k), Individual Retirement Accounts, and other self-directed retirement savings instruments allow the individual a lot more control over his or her investments, and that can pay off.
"So many companies have moved into a role where they are much more in charge of their financial future than they have been in the past," he said.
McMillian says the biggest mistake you can make is NOT to participate in an office 401(k) plan, especially if the employer matches your contributions. He says he tells young people all the time, that while retirement may seem a long ways off, the marvels of compound interest will be working for them in all those decades to come, and it will really pay off when that big retirement party rolls around.
"I say at this point, the worst thing you can do is not have a good idea of your long term goals and your time horizon, relative to the long term growth in your portfolio."
McMillian says unlike several years in the past decade, the end of 2017 will be a positive time to take stock of the growth in your portfolio, because many saw major growth in the past year, and to make preparations for the future, including possibly placing more of your investment money into bonds not only to take advantage of rising interest rates, but to hedge against a possible Wall Street correction in 2018.