By Jean Strock – 02 August 2022
Many clients use their portfolios to provide a regular monthly income throughout retirement. Others prefer to take lump sum withdrawals from time to time and yes we do hope to see cruise ships berthed at Princes Wharf again soon!
For those who are pre – retirement the option to save regularly into your portfolio is a great option for wealth accumulation.
We have seen enormous market volatility this year, initially in response to rising interest rates/ inflation and then the loss of sentiment from the Russian invasion – sorry ‘Special Military Operation’ in Ukraine.
The quarterly reports to the end of June did not make for good reading but in the past month we have seen our two most growth-oriented investments bounce by 7.1% and 7.5% respectively so saving throughout the bad times can pay off when market sentiment improves.
At a business level we rebalance portfolios to ‘buy the dip’ in sold off assets. Fund managers will also be buying the shares of businesses they like while the sales are on. For those that can, regular savings are a third way to pick up cheap assets.
Of course we can’t say it will be clear sailing from here. Rising interest rates and geopolitics are a potent source of volatility but continuing to buy assets through periods of bad news will pay off when the good times return.