CPA, CFP , MT, CLTC, CCPS Wealth Management Strategies ...

[Pages:2]Marla K. Ringling

CPA, CFP?, MT, CLTC, CCPS

Wealth Management Strategies, LLC.

March 2009

Stay the Course Advice is Wearing Thin

Yes, you heard me say it. Has my advice changed? No. However, I do realize that this is a very emotional and difficult time. We continue to be faced with an extraordinarily difficult market environment, one that is probably testing your patience.

The taxpayer cost for prior mistakes of the government and corporate America is growing each day. The negative news is staggering. For most of us, we are angry at the corporate world for their excessive spending which we are all paying for now. How could someone pay themselves (or their peers) excessive bonuses when retirement dollars are evaporating with the company stock decline? The deceit, mismanagement and depth of this crisis is giving all of us an uneasy feeling.

To make matters worse, there is a prevailing concern that government is not addressing this current economic decline. I know this is an understatement for some of you. This perceived or real lack of leadership is certainly playing a part in the sell-off on Wall Street.

I am a big believer that our emotions are one of the primary factors in our long term financial success. Dealing with these emotions is critical right now. Timing the market is impossible to do. I am sure that each of you has talked with someone that has bragged about how they put all of their investments into cash a year ago. When the markets show a strong performance, I am sure that you have heard someone say that they got into the market at just the right time. Does it happen? Sure. However, I have been preparing income tax returns for over 25 years and reporting the gains and losses from stock sales for these "self-investors." Rarely, if ever, have I seen market timing work over the long term. It usually results in returns that are substantially less.

So what should we do?

Long-term, I believe that the markets are going to recover from this. We are starting to see positive signs in the marketplace. Retail sales were up in February. Inventory levels are falling. At some point in time, production will need to be increased to replace inventory. Lower gasoline prices have resulted in an increase in disposable income for many individuals. The news is starting to turn from all bad to some good. This usually means that the collapse is losing momentum and that the recession is at or near the bottom. The timing on this depends on the success of the Federal Government's monetary policy and the fiscal stimulus package. It is also going to depend upon investor confidence. Historically, stock values rise around six months before the end of a recession. When the bargain hunters start to step in, we could see a powerful rally. I am confident in our long term expectations. However, it is possible that it could be a very rocky ride.

Short-term, we need to be prepared for a volatile market. This could mean that there will be further declines in your investments. It seems like any trinket of bad news sends the markets into a tailspin. This can be gut wrenching for some of you. We want to address these emotions and if need be, change the risk characteristics of your portfolio so that you can more comfortably deal with this very trying market environment. There can be an opportunity cost to making changes. For some of you, this opportunity cost is worth it. The bottom line is that I sincerely want you to feel that your

strategy is one that you can live with both in the short and long term. For those of you who are not sure they can stand any more declines, we can help.

I am available to discuss any concerns that you may have. Feel free to call me at any time: 208.773.3888.

Marla K. Ringling CPA, CFP?, MT, CLTC, CCPS Wealth Management Strategies, LLC

802 N. Lincoln Street Post Falls, ID 83854 Telephone: 208-773-3888 Toll Free: 866-773-3888 Fax: 208-773-7552 marla@

Registered Representative, Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc. a Registered Investment Advisor. Wealth Management Strategies, LLC and Cambridge are not affiliated. Cambridge does not offer tax advice.

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