Chances are, when you first made decisions about your investment portfolio, you were asked about your risk tolerance. Perhaps you filled out a questionnaire that identified you as a conservative investor who wasn’t interested in taking on risk. Or you were seen as quite tolerant of risk and willing to look at investments that had greater return potential but higher risk profiles. Maybe you decided on a 60/40 split of equities to bonds – the classic asset allocation.
Perhaps you’ve been putting off re-examining those initial investment decisions.
However, if you’re planning on leaving or have already left your employer, it’s a perfect time to take a look. To begin with, your financial circumstances may have changed:
Rebalancing your portfolio is about managing risk. It’s a big-picture look at what the investments in your Choices plan are doing. It’s also a way of protecting gains that you’ve made, since no investment style or asset class outperforms year after year.
Rebalancing can help you protect yourself from rash, emotional investment decisions when investments fall in value. With more varied investments in your portfolio, you’ll be more likely to look at the big picture and less likely to sell – and lose money – on an underperforming investment.
One way to assess your financial situation is to compare how your target allocation – the investments you selected way back when – matches your current one. Is it still similar or wildly different? Are you 5% or 10% off your target allocation in major asset classes? Can you meet your financial goals as things stand?
A Sun Life Financial Services Consultant* can provide you with one-on-one advice regarding your Choices portfolio. He or she can:
To contact a Sun Life Financial Services Consultant* who can assess your current investment mix, call 1-877-805-9303 Monday to Friday, 8 a.m. to 6 p.m. ET.
*Registered as Financial Security Advisors in the province of Quebec.