What to Do Now?

These financial planning tips never go out of style.

DO:

• Have a financial plan documenting where you want to be and how you are going to get there.
• Have an investment policy statement detailing how you will make investment decisions. This will prevent you from making emotionally-charged investment choices.
• Work with a financial planner who is compensated to provide objective advice, not an advisor who is compensated to sell products.
• Whenever possible, invest early and often. This forces dollar-cost averaging.
• Identify your risk tolerance before the next market pullback, and have an asset allocation that reflects that risk tolerance.
• Be truly diversified among large, mid, small, international, growth, and value stocks. Invest not only in corporate bonds, but government and international bonds.
• Make your asset allocation more conservative as you age.
• Rebalance your portfolio annually.
• Have an ongoing relationship with your financial advisor. Meet with him or her at least every six months.
• Update your financial plan and estate documents at least annually.
• Maintain liquidity in your portfolio. Having cash available will reduce your need to sell securities when their values are depleted.
• Take advantage of the full employer match on your 401k.
• Understand the risk/return relationship of all your investments.
• Understand how and how much your advisor is compensated.
• WORK WITH A FIDUCIARY - someone who is obligated to act in your best interest.

DON'T:

• Necessarily trust your financial advisor. Make him or her earn that trust.
• Let emotion get the best of you.
• Be enticed by new, short-term investment strategies.
• Trust "financial advisors" that encourage you to leverage your home, or push annuity products without mentioning the costs of such products.
• Neglect estate planning.
• Work with a financial planner who isn't financially motivated to constantly serve you.
• Pay high investment fees or commissions.
• Invest in things you don't understand such as gold, commodities, and options.
• Seek advice from friends and family who are not financial professionals.
• Seek advice from "financial advisors" with few tools, such as insurance or annuity salesmen.
• Use short-term investments for long-term goals, or vice versa.
• Invest for the long-term without an established emergency fund (3-6 months of expenses).
• Purchase loaded products.
• Work with a financial wolf in sheep's clothing (an advisor who is not a fiduciary).