Financial services

Investing in 2023 is 'definitely going to be rocky,' advisor says. How to stay the course


Francis Financial President & CEO on having difficult conversations with clients

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After some brutal market results in December, a few clients wanted to pull the plug and jump out of the market, according to Stacy Francis, a certified financial planner and president and CEO of Francis Financial in New York. Investors who stick with investing through the ups and downs in 2023 will be glad they did, predicts Francis, a member of the CNBC Financial Advisor Council.

“This is going to be a great year, and it’s definitely going to be rocky,” Francis told CNBC.com in February.

Yet there may be an upside for weathering that turbulence.

“This is a ride that you do want to ride because because you’re going to have some fantastic portfolio gains by the end of the year,” Francis said.

When difficult conversations inevitably come up amid market volatility, Francis said there are a few things she likes to remind clients.

1. Put losses in context

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For investors who were upset with the brutal results they saw in December, Francis said she reminded them of the big market pullback in 2020 after the onset of Covid-19.

“We lived through that and actually had one of the largest and most significant rebounds that we’ve ever seen in history,” Francis said.

Likewise, grim market results in December were followed by some of the best upswings in decades in January.

2. Take time to reassess your strategy

A market loss can make it “unbelievably painful” to open your 401(k) statement or pull up the website only see your contributions have disappeared, Francis said.

Those declines can be a great time to re-examine your approach, she said.

This is going to be a great year, and it’s definitely going to be rocky.

Stacy Francis

president and CEO of Francis Financial

“It’s a great opportunity to take a breath, have your portfolio rebound and re-evaluate after this time of real volatility to see is this the right mixture of stocks and bonds for [you] for the long term,” Francis said.

If you’re one to five years out from retirement and sustained large losses, you likely need to rethink your allocation strategy.

3. Resist the urge to follow trends

Cash has become a much more attractive place to put your money now, with some certificates of deposit paying more than 4% interest, while stocks are vulnerable to losses.

But moving your money from stocks to cash out of nervousness is likely the wrong move, as you will miss out on market gains, Francis said.



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