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Top 7 Financial Tips To Remember in 2020

financial planning investments economy retirement

Hi everyone! It’s Nicolle Yates, with Hamilton Financial Planning, back with our LAST installment of the Investing Basic Series for 2019! It’s been a wild ride guys and gals and I’m glad to have shared it with all of you. We’ve learned a lot this year … how and where to invest your hard-earned money, what’s going on with your employer-sponsored insurance, and weathering market volatility with confidence and ease among other things.


The end of the year is a time for reflecting on what has passed and preparing for what is to come. This past year has been a lot, to say the least. It’s been a tumultuous time, not only as a nation but as a world, sometimes making us feel like we don’t have firm ground to stand on. It’s confusing and exhausting trying to figure out what can be trusted and what can’t; who we can count on and who we can’t. 

In all honesty, this year has turned out to be wackier than we ever imagined. But as we’ve learned over and over during this series, history is no set indicator for what the future will be like. All we can do is enjoy the good, learn from the difficult, prepare for what is unknowingly to come, focus on what we can control, and hope for the best. 

Let’s take some time to reflect on how we can do just that.  

 When the going gets tough, remember these: 


7.  Have a Budget in Place 

We’re going all the way back to the very first topic for this blog series for this one! 

It’s important to have a budget in place, especially during this time of the year with all the traveling, gift buying, and holiday partying going on. But it’s equally as important to have this budget established all year around. If you’re an impulse buyer, or a retail therapy enthusiast, it might be hard to adapt to a budget. But instead of looking at your budget as a punishment … look at your budget as your buddy. Your buddy just wants what’s best for you, it’s not trying to make you feel bad; your budget just wants to keep you in check.  

If you’re still having a difficult time sticking to that budget, put yourself in your ‘Future You’ shoes. In 10, 20, 30 years from now, when you look back at this time, what will you think? More importantly, where will you be? Sticking to your budget is a way of paying and rewarding Future You.   

And remember, budgets are not a one size fits all. There are several different ways you can budget based on your preferences. There’s the old industry standard 50/30/20 rule where 50% goes towards your current needs, 30% goes towards your wants, and 20% goes into savings. But there’s also the 80/20 rule where 80% goes towards your lifestyle needs and wants and 20% goes towards savings.  

 Check out more budgeting rules here

6.  Research, Research, Research 

We have talked a lot this past year about doing your research, and we’re going to talk about it one time more.  

 You work hard for your money. Your money deserves to be put in the investment vehicles that are going to help you achieve your financial goals and get you to where you want to be, so it’s imperative that you do your research! 

Make sure you know exactly what you’re getting into before you get into it. This goes for where you open your investment account(s) at, what types of investment accounts you need, and what you put into those accounts. When browsing the different securities, consider the drivers of return. For equities, drivers include company size, relative price of stock, and profitability of stock. Drivers of return for bonds include term length, credit quality, and currency of issuance.  

Morningstar.com is a fantastic resource for checking out different securities that you’re interested in and to make sure they’re the right fit for you.  

5. Diversify Those Assets 

While you’re researching, make sure your securities are diverse. Don’t put all of your eggs in one basket, as they say. Have a portion of your portfolio going towards local, global, and international stocks and bonds. Diversification won’t guarantee against loss, but it will help to keep you balanced if a segment of the market takes a downswing. 

 Pay attention to what stage of life you’re in as this helps you determine how much of your portfolio should be allocated to different securities.  

In your 20s and 30s, you’re goal should be: SAVE, SAVE, SAVE. Easier said than done? Yes, but remember, think about your Future You and how much they’ll be thanking Current You for your contributions. At this age, you can rest comfortably with 80% stocks and 20% bonds in your portfolio, you’re trying to grow those assets while you still have time.  

Once you hit your 40s and 50s, you definitely want to start changing that allocation from 80% stocks and 20% bonds, to 60-75% stocks and 25-40% bonds. You want to do this because you have more to lose and less time to recover from that loss.  

And when you’re nearing retirement, you want to move to a more conservative 40-50% in stocks, and 60-50% in bonds. Be a little more strategic in the longevity of your investments - make sure you have some short term investments like cash and CDs, intermediary investments like IRAs and taxable accounts, and long term investments like Roth IRAs.  

It’s also important to note to make sure you have a cash reserve anywhere from about 3 months worth of living expenses to 2 years worth of living expenses. If that seems daunting, start with a smaller goal, like $1000 in your savings account, and continue to incrementally increase that goal.

 4. Don’t Try To Outguess the Market 

The market is a very efficient and effect information-processing machine. The market handles billions of dollars EVERY DAY. Stock prices are constantly adjusting to the new information it receives with each trade. So even if you don’t necessarily agree with a certain stock’s price, you can accept that the market is giving you the best estimate of the actual value at any given time.  

3. Invest For the Long Term 

 With that being said, it’s important you let the market work for you. A good way to do this is to invest for the long haul. When you’re doing your research, check out stocks that have potential for longevity. Historically speaking, the stock and bond markets have provided growth of wealth that has more than offset inflation, including all of the times the market has taken a downturn - that’s more that can be said for most checking or savings accounts.  

Yes, this does take discipline, but remember why you’re enduring all of this in the first place: to make money. And remember why you’re trying to make money - to retire with dignity, to buy a home, to put your kids through college. It’s your life, remembering what you’re living for and make it happen. 

2. Keep Your Emotions in Check 

With that being said, don’t let those same emotions get in your way. An effective trick is to tune out the noise. Daily financial news can be intense, anxiety-inducing, and confusing. I know this is much easier in theory than in real life with all of the notifications and talking heads on every screen.  

Consider various news sources you can rely on.  

1. MarketWatch News Viewer 

2. Bloomberg

3. Investopedia 

4. The Wall Street Journal 

5. Financial Times 

…  Just to name a few.   

1. Focus On What You Can Control 

Finally, and possibly most importantly, focus on what you can control. The market is going to do what it’s going to do, life is going to do what it’s going to do, and if we only pay attention to that, we’ll lose ourselves.  

 Rather than being reactive, be proactive. Choose how you spend your money; choose where you put your money, and what you invest your money in. 

 Gaining control can be daunting and even scary because the moment we decide to take control, we decide to take responsibility. And once we take responsibility, then it’s in our hands to decide where we want to go and to make the necessary choices to get there. 

 But you’re not alone, we can do this together! Let’s take the things we’ve learned this year and move forward into the next year with a little more knowledge, a little more confidence, and less reactivity.  

 Along with everyone at Hamilton Financial Planning, I wish you and your families a happy Holiday Season and a Happy New Year!  

 If you have any questions, want to discuss financial topics, or you’re looking for a new Financial Advisor, call us or schedule a Get Acquainted Meeting today! 

 


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