Our advisors utilize their experience and expertise and that of their colleagues to develop the best solutions for your complex personal and professional financial situations.
Actionable planning strategies to inform and guide your decision-making.
July 1, 2021
On one hand, the stock market goes up more often than it goes down. Stock returns are also usually higher than bond returns. Thus, on average, a helicopter drop into a risk/stock-oriented, diversified investment portfolio will outperform a phased implementation into that same portfolio over time. On the other hand, forecasting short-term returns for stocks is a loser’s game and a big loss via a stock market correction can be psychologically devastating, especially for investors with newfound wealth and little experience managing it. A bad experience on the front end can therefore jeopardize long-term success. When it comes to managing wealth, the long game is the game that matters. While not always, we typically recommend taking a breath and easing new cash into the market over a period of one to two years. This process entails implementing a portfolio at a stock allocation (including residual company stock, if any) that is below the long-term target, and purchasing more stocks over scheduled tranches until the long-term allocation is reached. Again, on average, this is a losing strategy! Probabilistically, you can’t buy stocks soon enough. On balance, however, a phased implementation is often a very sensible approach for several reasons:
Another area of focus on the front end is bucketing assets into categories and aligning investment strategies with each bucket. For example, many clients who come into a large sum of liquid wealth want to acquire or upgrade a home. If the timing of that significant expenditure is short-term, a more conservative investment allocation for that bucket (as compared to, say, a “nest egg” bucket) is likely warranted to reduce loss exposure. In other words, it makes sense to accept lower expected returns for these assets because downside protection is more important than growth potential. Bucketing assets in accordance with defined objectives, coupled with forming investment strategies tailored to your time horizon, are key building blocks to successfully managing wealth through time.
Please read important disclosures here.
Aaron is a Partner based in the San Francisco office. He provides comprehensive investment and planning advice to individuals. While Aaron works with a wide...
Ben Pace, Christian Thwaites and James Lebenthal
January 31, 2023 — Global equity prices rallied in January, as inflation continued to recede and investors’ hopes mounted for an end to central bank tightening cycles.
Michael B. Fischer and Frederic Behrens
January 22, 2023 — As part of Tax Cuts and Jobs Act of 2017, the U.S. federal estate tax exemption amount increased to approximately $12.92 million per individual or $25.84 million per couple (2023). As a result, many families are no longer subject to federal estate tax due to the high estate tax exemption amounts. However, several individual states […]
Steven J. Giacona
Partner & Market Leader
January 10, 2023 — As a CPA and financial advisor, clients often ask me for ways to reduce taxes. Since the enactment of the Tax Cuts and Jobs Act of 2017, which limited state and local tax deductions to $10,000, many clients, particularly residents of high-tax states such as New Jersey, New York and Connecticut, have raised the question […]
Theodore D. Schneider
January 10, 2023 — Our team at Cerity Partners is continually inspired by the efforts of charitable organizations and want to offer our assistance to boost planned giving campaigns. As experienced advisors in financial and philanthropic planning, we believe having focused discussions with potential donors regarding the following planned giving strategies are effective tools to encourage donors to complete […]
January 10, 2023 — It is increasingly common for individuals living in the United States or U.S. citizens living abroad to receive an inheritance from a non-U.S. person (for purposes of this article a non-U.S. person is defined as someone who is not a U.S. citizen, permanent resident or otherwise considered a U.S. domiciliary resident). Receiving an inheritance from […]
Curious about learning more? Let’s talk.
Tell us about yourself and your current financial situation without cost or obligation. Receive an introduction to a wealth management colleague, have a personal conversation, and get your questions answered.