In her latest column for South Florida Business and Wealth, WE’s Julie Neitzel identifies a growing challenge for investors and their advisors: the disconnect between many investors’ return expectations and the returns they’re likely to actually get.
Recent data suggests that investors expect double-digit returns – an expectation based on the performance of the stock market for several decades. However, Neitzel cites recent State Street Global Advisors research that suggests a balanced portfolio is expected to deliver significantly lower returns in the range of 3 to 4 percent annually for the foreseeable future.
While this is not the news many investors wish to hear, Neitzel provides suggestions for closing the gap between expectations and the current reality of our slow-growth environment. Her suggestions include a combination of saving more, spending less, reducing investment fees and understanding investment risks. By resetting expectations and re-evaluating financial goals, she concludes, investors can develop a plan that has a higher probability of success.
The full South Florida Business and Wealth article is available here.