Presented by your Hawaii NEA Retirement Specialists
We’ve seen unprecedented volatility in the stock market recently, and it doesn’t look like it’s going to stop anytime soon. With all of the craziness in the stock market associated with COVID-19, now is a great time to take a look at your portfolio or 403(b).
Here are four questions you should ask yourself:
- How close are you to retirement? The stock market has rebounded from the last two bear markets (2000–2002 and 2007–2008), but it took about four years to recover each of the last two times. Past performance is no guarantee of future results, so there’s no telling how long it will take to recover this time. If you are going to be retiring in the next few years, it would be definitely worth having your portfolio reviewed.
- What is your risk tolerance and does your portfolio match it? Everyone has a different tolerance for risk. Some people are more naturally aggressive and big drops in the stock market don’t faze them. For others with a more conservative risk tolerance, big decreases in the stock market can cause real anxiety. We meet a lot of teachers who have portfolios that do not match their risk tolerance. This is a great time to take a risk tolerance test and have your portfolio reviewed to make sure they match.
- Are you in the right product? The State of Hawaii DOE 403b has multiple products that are approved for you to use. There are mutual funds, variable annuities, fixed annuities, and indexed annuities. Each of the different products has pros and cons. You should find which product fits the best for you.
- Do you have the right portfolio management? The traditional buy-and-hold (strategic management) has historically worked as long as you have enough time to let the market recover. An actively managed portfolio (tactical management) tries to decrease risk by rotating out of stocks and into bonds, in times of volatility, and then back into stocks during times of growth.
Speak to an NEA Retirement Specialist about reviewing your current portfolio and find out the best fit for you. To contact NEA Retirement Specialists for a complimentary consultation, please email info@shiraishifinancialgroup.com or call (808) 951-7185. We are happy to arrange either a phone conference or a Zoom conference call to accommodate HSTA members during this time.