Investment mix

Today was our half-yearly meeting with our financial adviser. It was time to see how our retirement savings were going and doing a little fine-tuning to the investment mix. It was nice to meet in person at his office rather than over Zoom. Some sense of normalcy returning to our lives. As usual, we exchanged a few pleasantries before getting into the business of finance.

Even after the massive fall in our investments at the start of the pandemic, our investment has grown nicely over the past year. Our investments are a combination of shares and bonds. Whenever we meet our financial adviser, we discuss whether to take more risk by having more in shares, and less in bonds, or vice versa, by having more investment in bonds.

Last year we took a punt on shares, and it paid off. Our financial adviser thinks that the massive dip in shares twelve months ago was an overreaction by the market.  With companies being less impacted by COVID-19, their profits soon returned, and the share market took off again. This was good for us, as it allowed us to recover some of the losses from twelve months ago.

These share market gains are now all in the past. It is time to go safe by increasing the percentage of bonds in our investment and reducing shares. We should know in about six months if we have made the right decision.