Consumer

Expert Answers Tough Financial Questions

BALTIMORE (WJZ) ― Financial expert Robert O. Stachura answers your financial questions.

Question: "Do you think the market will get better? If so, how far in the future?" -- Betty, Calvert County, Md.
 
Answer: "The Fed indicated that it would take approx five weeks for the $700 billion to be distributed to the institutions requiring funding. Without money, banks can't loan, businesses can't borrow and companies (stocks) won't prosper.  Once these lending institutions have money to lend we may see improvement."
 
Question: "When the market recovers, should I sell my stock and get into something more secure? What are your suggestions?" -- Betty, Calvert County, Md.

Answer: "Betty, I don't know your age, investment time horizon or purpose of the invested monies. All are very important when making this kind of decision.  As a comprehensive financial planner, I typically suggest beginning with a balanced portfolio of stocks, bonds and fixed accounts. A balanced portfolio is like cylinders in an engine- not everything goes up at once nor does everything go down at the same time."
 
Question: "Is now the right time to start investing in the market?" -- Rian Thomas, Cockeysville, Md.

Answer: "This is a great q Rian! Let's face it, the market is on sale. When tuna is on sale, we buy more tuna!"
 
Question: "I'm 41-years-old and have been putting money into my 401K plan for 20 years. In the last week, I have lost 25 percent of my money. Should I move it out of the stock market? Should I have done that sooner? Or should I ride it out and hope I don't lose everything?" David Underwood, Sparrows Point, Md.

Answer: "Dave, I understand your concern. Again, I refer to a balanced portfolio and diversification. I do not know what investments you currently hold or if this is your only savings- but this is an excellent reminder to diversify single company stock w/in your retirement savings.
Too many people held Constellation Energy Group stock in large amounts, only to watch that drop in half very quickly over three days. Balance and Diversify. If you don't know-see a professional!"
 
Question: "I am older and living on a pension. I have some money in stocks that I use as emergency money. Should I cash them in?" -- Gloria, Baltimore, Md.

Answer: "It is suggested that an emergency fund consist of 3-6 months of living expenses and that account be held in cash. Gloria, I know gals like a little extra cash too so many times the cash amount is more! As for investing the balance- age, time horizon, type of emergency (healthcare, new roof, etc) and diversification is important."
 
Robert O. Stachura, CFP
Retirement Wealth Advisory, LLC
1300 York Road
Suite 200
Lutherville, Maryland 21093
410-339-6600
 
Securities and Investment advisory services offered through Lincoln Financial Advisors, Corp., a broker-dealer and registered investment advisor. Insurance offered through Lincoln affiliates and other fine companies. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates.

(© MMVIII, CBS Broadcasting Inc. All Rights Reserved.)