Inflation is challenging. Take a breath and re-balance your investment portfolio

Paul Fain, CFP®

“I will survive!” sang Gloria Gaynor in the 1970s. Back then, it could have been a battle cry: Oil prices surged, inflation peaked at 14%, and the U.S. stock market plunged 45%.

Almost 50 years later, we are facing challenges on the same fronts, but not at the severity of the 1970s. We will survive. How? Survivors take action. They protect their portfolios without sacrificing their financial goals.

Use volatility as your friend. Now is a great time to re-balance your portfolio allocations to your target diversification strategy.

Trim or sell bad performers (note: suitable investments can have bad years). If you have some terrible actors, upgrade your holdings.

Don’t dismiss the value of bonds in your asset allocation. Despite this being the worst year on record for bonds, they are still doing their job of insulating our portfolios from more significant losses.

This article was initially published in the Knoxville News Sentinel on May 20th, 2022