You may think you have given great consideration to the various options for your finances and chosen your investments wisely. But then events you could never have predicted take place and there’s talk of a market downturn.You’re suddenly no longer so confident that your finances will withstand all that’s being thrown at them. You wonder if there’s more you could be doing to protect your family’s wealth now and for the future? There’s no doubt that the reality of Brexit, be it ‘hard’ or ‘soft’, is creating a period of great uncertainty. And the markets hate nothing more than uncertainty. The resulting volatility, therefore, could potentially erase the value of your investments overnight. Added to which, the increasing threat of terrorism, quantitative easing, inflation and escalating global debt could all play havoc with the plans of even the most prudent saver. Our video below explores the five main risks to your investments in a market downturn and outlines what you might do to counteract the effects. For example, just consider…
- What would happen to the value of your cash in the bank or ISA if the interest rate dropped lower than inflation?
- What would happen if you had bonds or shares in a company which went bust?
- What if the property bubble bursts because foreign investors decide to stop buying UK property?
- What would happen to your mortgage if interest rates increased to control unstable markets?
- What would be the impact on your pension if the stock market crashed?
Any one of these could mean your wealth could be diminished overnight. However, by taking some simple precautions you can protect your retirement plans, your standard of living and the future prosperity of your children. Diversifying your investments, such as investing tax-efficiently in precious metals, is one of way of minimising the risk and protecting your portfolio in the event of a downturn.Highs and lows in the financial markets will always be inevitable but there are steps you can take to protect your finances from the rollercoaster effect. Don’t miss out.