Next Year, I Resolve to…

12/29/2008 2:30 pm EST

Focus: MARKETS

Terry Savage

Author, The Savage Truth on Money

As 2008 comes to a close, it's pretty easy to think of lots of resolutions you should have made for this past year.

In hindsight, you would have sold all those stocks last January, or written options on your long-term portfolio, or raised a lot more cash. You would have been disciplined about jumping back in early, figuring this bear was alike the others of the past 20 years and due for more than a little bounce.  Hindsight is 20/20, for sure.

But the real question is: "What will you resolve for 2009?"

Obviously, you can't "resolve" to have a new bull market-that's out of your control. But you can focus on smart asset allocation and sound financial planning.

So, is this the year you will actually:

  • Update your will or living trust?
  • Make sure you have enough-but not too much-life insurance, and the correctly named beneficiary?
  • Purchase long-term care insurance, which is insurance for your retirement planning?
  • Set up online bill paying with your bank or Quicken or Microsoft Money?
  • Rethink your monthly spending plans in light of economic uncertainty?
  • Leave a list documenting all your account numbers and document locations?  (You can download my personal financial organizer form by filling out the popup box at www.TerrySavage.com and then clicking on the link in the return E-mail.)

Or are your 2009 resolutions more focused on how you will invest your money? Will you follow through on:

  • Setting up a target asset allocation and sticking to it?
  • Bulking up your cash position (selling down to the sleeping point)?
  • Remembering that bonds are dangerous in an inflationary period (when rates rise, bond prices fall)?
  • Selling those funds you think are poorly managed and unlikely to come back, even in a rally?
  • Finally buying some gold stocks, or gold coins, in case hyperinflation debases our currency?
  • Understanding those annuity products, and switching to better deals after the surrender period runs out?
  • Learning to use options to create income on your long-term portfolio?

OK, what have I missed?  What are your financial new year's resolutions?  And what's the likelihood that you'll keep them? What do you think investors should do in 2009?

Have your say and join the conversation!

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