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Identify investment objectives and develop the best strategy continued from p.18 or second, the adviser might initiate a discussion. The investor's concern is the risk of losing money and therefore, they want to manage that risk by having less exposure to stocks. On the surface, that is a reasonable thought, but there are other considerations. Ultimately, the investor has to manage all risks. The two main financial risks are: having their portfolio decline in value and also the risk of the couple out-living their capital. My opinion is that for most investors, outliving their capital is a more significant risk. We are living longer and very few people have significant pensions. We have to be financially self-sufficient during retirement and that requires a combination of not losing capital but also not running out of purchasing power from our portfolio. Our investments have to provide the cash flow we so desperately need during retirement. Any investment decision must be made in the context of maintaining that cash flow. If the client reduced the stocks in their portfolio from 60 per cent to 40 per cent then the likely outcome would be to have an investment portfolio that is less profitable. A less-profitable portfolio could result in them running out of money. An exercise that should be done before investment decisions are made is to understand the purpose of the funds. The client will likely require a certain amount of income every year during retirement from their investment portfolio. There might be more risk to them running out of money during their lifetime, which is far more significant than having a portfolio that has slightly higher volatility. Investing is done for a reason. Articulate your investment objectives and then work backwards from those objectives to see what is the best investment strategy. Clients are required to make investment decisions and we recommend those decisions be guided by their long-term financial objectives. -- Submitted by Peter Watson, MBA, CFP , R.F .P ., CIM, FCSI., Certified Financial Planner 19 | Thursday, August 6, 2015 | OAKVILLE BEAVER | www.insideHALTON.com nbhtech.ca Our delicious & authentic Mexican food and salsas are always fresh! Come in to try one of our take out meals for the whole family to enjoy at home. At Nostalgia, it's always Fiesta Time!! Get a FREE bag of Fresh Corn Tortillas when you purchase one of our take out menus. (Valid Aug 7th to Aug 14th ) 391 Kerr Street, Oakville Tel 905.845.9262 www.nostalgialatinmarket.com Follow us on Facebook #Nostalgia Latin Market. ComputeR RepaiR from $ 99 iphone RepaiR from 39 $ 1 houR SeRViCe! 3999 Dundas St. e., unit D10, oakville 905.257.1647 380 (@ Trafalgar rd., Canadian Tire Plaza) 905.338.5721 Auto Servi ce · Scheduled Maintenance · Fuel Injection · Computer Diagnostics · Transmission & Clutches Accredited Test · Front & Rear End Work & Repair Facility · Electrical · Windshield Repair/Replacement · Shocks & Struts QEW · Air-Conditioning · Brakes Wyecroft · Tune-Ups JNB · Engines · Tires · Wheel Alignments · Oil & Fluid Changes Weller Ct. Insurance Claims Collision Repair Auto Body & Paint Auto Body ruS A uSed 0c d 0 An p From $2,0 www.jnbautocenter.com BULK MULCH, SOIL, SAND, COMPOST, INTERLOCK, STEPS, AGGREGATES, ARMOUR STONE, JUMBO FLAGSTONE, PIZZA OVEN, FIRE PITS AND MORE!! WE SELL ..... Dorval Dr. WE DELIVER!! 4th Line QEW 450 Wyecroft Rd., Unit 4 Monday-Friday 8-5 Saturday 8-1 landscapeelements.ca Dorval 294 Wyecroft Rd., Oakville Get Your Rocks Off Us! 905-337-7625