Investing key themes in 2020, according to this Financial Advisor

Yahoo Finance’s Julie Hyman, Myles Udland, and Brian Sozzi discuss how to manage your portfolio in these times of uncertainty with Facet Wealth Founder & CFP, Brent Weiss.

Video Transcript

JULIE HYMAN: We were just talking about the state of people's personal finances, whether it comes to stimulus checks or what they're searching for on Investopedia, for example. Let's bring in someone else who has some perspective on this. That's Brent Weiss, he is Facet Wealth CFP, and he's joining us as part of our financial advisors series, presented by PIMCO. Brent, what are you hearing from your clients? What are their top concerns about their personal finances right now?

BRENT WEISS: Well, it's interesting, Julie, that you mentioned that. We actually did an independent study here at Facet Wealth that showed about a month ago, two months ago that the top two concerns, number one was the presidential election. The good news is we can take a deep breath. We have the outcome from that at this point.

Number two was the coronavirus, right? The impact on the-- sort of this global health pandemic, an impact on financial health and wellness of everyday American households. The good news is we can take a deep breath and move beyond that now. We have good news around the vaccine. But here are the three key themes that came up in 2020 for us and for our clients that we're talking to when it comes to their financial plan.

Number one is we talked about, as you mentioned this a second ago, the financial foundations of everyday American households. It's critically important. It sort of shed some light on the cracks that some of us have in that foundation. So we're talking about rebuilding that with positive cash flow, building that emergency fund, paying down some bad debt, cleaning up that balance sheet.

Number two, debt and taxes, right? The stimulus was necessary. We believe that's going to benefit all of us in the years ahead. However, it did accelerate the deficit. It did accelerate national debt. We've heard with Biden's preliminary tax policy, what does that mean for the future of tax policy for everyday Americans? So we're talking about cash flows and balance sheets, right, creating tax diversification, not just stocks and bonds but Roth IRAs, traditional IRAs, where to fund those accounts.

And then frankly, we're focusing on what we can control. Clients with a financial plan really feel empowered by this because they go back to the financial plan. I always say, don't chase the markets, follow your plan. They're coming in and saying, hey, I feel really good about it. What do I need to do before December 31 to make sure that I'm taking care of any tax loss harvesting, some 529 contribution before year end versus trying to figure out, what does the world have in store in the future? We're not sure. We're focusing on the things we can control today, Julie.

MYLES UDLAND: Brent, do you feel like the clients you talked to are better informed about their finances than they used to be? I mean, there is just so much content out there in personal finance land. And, of course, it doesn't mean anything if you don't know what your own finances are. But do you find that this is actually leading to maybe more enlightened, less basic conversations with your clients, or is it maybe a problem of information overload for some folks?

BRENT WEISS: So Myles, I love this. We just had Caleb Silver with Investopedia on. The wealth of information out there I think is very, very good. We are dealing with a much more informed, I'll say investor, but really, when it comes to their financial plan, which I truly appreciate the challenge is, because there's so much information, we don't know where to turn. And this is why I think a financial plan is really so important for everybody out there is because when you look out there, you're going to get 10, 12, 15 different points of view on one topic.

Like, how do you make sense of all this when you're going, OK, what about tax policy and ordinary income taxes, capital gains taxes, what about the economy and the markets? If you sit back and actually say, OK, I am more informed, but how do I put the pieces of the puzzle together? And that's why, at least for the clients that we represent here, Myles, that they're very informed, they're thinking about, OK, all the pieces come together. I have a plan and a strategy moving forward.

The challenge when you don't have a financial plan in place, and you go out there, you look at all this information, you're not really sure where those pieces of the puzzle fit. And that's where you can feel overwhelmed. So my recommendation for those out of the normal plan is sit down and think about what really matters, what are my goals, what do I want to achieve in 2021, I what can I control? And then try to put all that information together in a way that makes sense for you.

JULIE HYMAN: Yes, because indeed, as you say that, information can be overwhelming. Got to leave it there. Brent Weiss, thank you so much. Facet Wealth CFP joining us there as part of our financial advisors series. Appreciate it.