How did you vote last November? Did you make your decision based on party lines or perhaps due to personality? Or, did you vote with your wallet because you were worried about your personal finances? If so, you aren’t alone.

While many are celebrating a new and glorious economic era now that Trump is president, plenty are concerned about their personal finances because of him. Financial markets like predictability, and if there’s one thing that President Trump is not, it’s predictable.

In fact, based on what we’ve seen so far, the only constant is this: We’ll never know what to expect as long as Trump is at the helm. How will this uncertainty affect your personal financial plan? What should you be doing to adjust to our “new normal?”

Keep Your Eyes On The Prize

I may sound like broken record here, but you’ve got to keep your head straight and don’t let your emotions cloud your judgment in times like these. If you’ve made the effort to determine your investment philosophy, then just sit tight and focus on the long-term, ignoring the momentary noise.

Market uncertainty is normal and expected in the average economic cycle. When you add in unprecedented political events, things get even more exciting. When Trump won the election, markets plummeted 700 points (remember that?) before shooting to record highs within a week. Since then, every time the Dow hits new records it’s usually due to a headline political event like inauguration day or Trump’s speech to Congress.

All this buzz just reinforces the fact that financial planning is for the long-term. You can get dizzy trying to keep up with media sensationalism, so it’s best to simply tune it out and trust your investment philosophy. If you can keep your long-term perspective in spite of all the noise, you will steadily build wealth for a successful retirement, no matter what happens. Because what happens next is anyone’s guess.

Follow the Evidence

Want to know why I love evidence-based investing? Because it works. It’s based on sound economic principles and backed by decades of science that builds wealth no matter who is in charge. Evidence-based investing has been proven time and again in all kinds of different circumstances (to see the real data, click this link and scroll down from the home page).

Here are some tried-and-true investment principles that will carry you through, no matter what Trump tweets next.

“Tilt” Your Portfolio to Build Wealth Smarter

Academic research has identified certain factors that will help you get the best return for your investments. First is company size. Stocks of smaller companies (“small-cap stocks”) have historically had higher returns when compared to their larger brethren (“large-cap stocks”). Second is value stocks. Stocks can be broadly divided into value stocks or growth stocks. Historically, value stocks (think General Mills or AT&T) have outperformed their more flashy growth-orientated peers (think Tesla, Google, or Apple). Finally, there is profitability. Companies with higher profitability tend to have higher returns, over time, compared to lower-profitability companies.

When you intelligently tilt (i.e. mindful of expenses, fees, and transaction costs) your portfolio toward these areas of better returns you are using the best work of Nobel Laureates and financial science to build wealth.

Mix It Up

Speaking of an investment mix, that’s exactly what it’s supposed to be, a mix. Don’t put all your eggs in one basket. When you look at your portfolio, you shouldn’t see an overabundance of stocks or a heavy load of domestic investments.

This rule applies to each and every one of your accounts. While your professionally managed accounts may be diversified, how about your 401(k)? Is it compatible with your risk level or do you need to make some changes? How well are you diversified when all of your accounts are combined into an online wealth management platform?

A Healthy Balance

Once you know your risk level, you can diversify to create a solid portfolio for yourself. But what happens several years later? Some investments grow rapidly; others seem to stagnate. Soon, your well-balanced portfolio is no longer balanced. You need to rebalance.

Do you buy a car and then never get an oil change or a tune-up? To put it simply, you continue to invest in your investment to make sure it doesn’t cost you more down the road. This is true for your money as well. Review your portfolio annually to make sure all of your assets are allocated appropriately. Some years you may not need to make changes, but without a regular review, you could find your portfolio far away from where you want it to be.

Don’t Expect Others to Take Care of You

Right now, Social Security represents about 34% of the income of the elderly¹, but will that be the case when you reach retirement age? In the past, Trump has given his support for the program, but with his promises to abolish Obamacare and cut taxes, the future of Social Security and Medicare is far from certain. Even if Trump doesn’t touch Social Security, it’s already heading toward insolvency, paying out more than it brings in.

Don’t plan on using Social Security as a primary source of income in retirement. You need to take your future into your own hands and maximize your IRA and 401(k) contributions. Build a nest egg that will provide for what you need in retirement. Then, anything you get from a government program will just be icing on the cake. A good mantra that I use in financial planning (and for life in general) is “Prepare for the worst. Hope for the best.”

Build a Support Team

Whether it’s investing or exercising, things are usually better when you’ve got a partner by your side. If you are unsure about where you stand financially or feel less than confident in your retirement strategy, ask for help. Schedule a quick chat with me below to discuss your situation. No obligations, just helpful advice.

Want more advice on making the most of your money? Schedule a no-obligation chat with me below.