Risk Management

By: John P. Napolitano, CFP®, CPA, PFS, MST

Many people have been working from home during the pandemic. For many, what was once an office environment surrounded by your colleagues, and all of the other distractions that come with being in a workplace has turned into a living room with printers, scanners and video conferences.

By: John P. Napolitano, CFP®, CPA, PFS, MST

I think Charlie Brown had it right, “worrying won’t stop the bad stuff from happening. It just stops you from enjoying the good”.

According to Wikipedia, “The black swan theory or theory of black swan events is a metaphor that describes an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight.”Covid-19 is a Black Swan event. Like the Black Swan events that have come before this one, we will get through it. When, however, is anyone’s guess. Based on this unknown, here are a few ideas that may help you survive this event without sending yourself into a deep depression.

No one enjoys headlines that make you shiver, except for the broadcast networks themselves. Recent market declines are based on the fear of the unknown, which translates to everyone’s own interpretation of the financial consequences of the economic slowdown due to the coronavirus. Thinking we may be in store for a prolonged decline may be overblown, but they feel pretty darn real in the short term as you are watching the values of your portfolio decline.

By: John P. Napolitano, CFP®, CPA, PFS, MST

By: John P. Napolitano, CFP®, CPA, PFS, MST

 

There are many times in your life where danger is looming and you think you’re all good until something happens and you realize that you were vulnerable. In day to day life, a good example is the new car you just bought where the dealer forgot to fill the spare tire with air. You’re cruising around happy as a clam until you hit a pot hole and then all of a sudden the auto dealer is not on your most favored vendor list.

By: John P. Napolitano, CFP®, CPA, PFS, MST

The volatility experienced at the end of 2018 is something long forgotten by some investors. Volatility isn’t always a bad word, it really means a tendency or vulnerability to rapid change, often unpredictably, especially for the worse. For equity investors, 2018 exuded evidence of increased volatility, and much of it was in the downward direction.

By: John P. Napolitano, CFP®, CPA, PFS, MST

Whether it’s called home or room sharing, short term rental arrangements (or whatever the regulators ultimately call it), millions of people have jumped on the bandwagon of either renting or advertising rooms for rent for as short as a single night. This may work wonders for your cash flow if you need extra money, but it also has a set of income tax and risk management considerations that can’t be ignored.

By: John P. Napolitano, CFP®, CPA, PFS, MST