Greetings,
As a rational person might have expected, the current administration’s “Liberation Day” news has gone over like a lead balloon with global investment markets today. At the time of this writing, the U.S. stock indices are down about 4-5% as of the morning of April 3, 2025. International stocks are down about 1-2% today, while a “flight to quality” has the bond markets with positive returns on the day.
This is what we have been preparing you for, whether you or we knew the exact timing or not. If you only take one thing away from this update, let it be: Do not panic sell – stay the course – and talk to us before you make any drastic portfolio changes or adjustments.
We do not want to speculate on how things will play out in the markets over the coming days, but here are a few things to keep in mind:
Diversification is your friend.
While today’s news headlines are primarily focused on the U.S. stock market, remember that if you are a client of our firm, you own a diversified portfolio that is comprised of more than just U.S. stocks. As a frame of reference, while U.S. stocks are down about 8-9% since January 1st, international stocks are up about 4-5% over that time and bonds are up about 3% as well.
Since no one can accurately predict the future, staying diversified is the prudent path. Diversification is kind of like exercising, flossing, and eating your vegetables…it never goes out of style.
Keep a longer-term perspective.
You are likely aware that our typical cadence for client meetings is for an annual check-in, though we are flexible in how often we meet with clients. This cadence gives us a unique perspective in that we get “snapshots in time” of the progress towards your financial goals. These snapshots give us ‘stakes in the ground’ that we can use for measuring progress.
I mention this because day-to-day “noise” can often make us lose focus on longer term progress. For instance, that same U.S. stock market that is selling off in early April 2025 is still about 3% higher today than it was this time last year. It is about 115% higher today than it was the same time 5 years ago.
My lovely wife is an elementary school teacher and for years she has told me that “growth is not linear.” Sure, she was referring to the educational growth of children, but the same thing can be said about the stock market. Economic markets are cyclical in nature and often take one step back before taking two steps forward. For those of you who are close to retirement, remember that our Monte Carlo modeling accounts for growth that is not linear. For those of you who are a decade or more away from retirement, keep investing as usual and enjoy the discount/sale U.S. stocks are being offered at compared to last week.
We are here if you need us.
As is often the case, it is difficult for a newsletter to speak to every specific client situation. The last thing we want any of our clients to do is to panic sell in a down market. If you are feeling anxious and need a sounding board, please reach out to your planner or our general email at info@arrivity.com to set up a time to talk.
All the best,
Your Arrivity™ Financial Planning Team
603 Financial, Inc. dba Arrivity Financial Planning
1200 Westlake Avenue North / Suite #508
Seattle, WA 98109
(206) 217 ‐ 2583
The foregoing content reflects the opinions or perspective of Arrivity financial planners and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful. Arrivity does not give tax or legal advice. Tax and/or legal strategies should be discussed with a professional before implementing.