Assessing your risk tolerance isn't a one-time deal

I participate in and am fascinated by the stock market, and since it's an important part of any financial plan I want to continually educated you on the ins and outs of investing. To take it up a notch I brought in my buddy for over 20 years Christopher Lee of Kessinger-Lee Financial Group in Lexington, KY. I brought Chris on the radio show this week to discuss the market craziness we've dealt with this year and the realities of risk tolerance. Take a listen here:

Courtesy of WIBC

It's been a strange market year. We'd been lulled into comfort by the last couple years of slow and steady growth, so the ups and downs of the market this year came as a surprise. Though, of course, it shouldn't be that surprising. Sometimes it take a market correction for you to reevaluate your risk tolerance. Did you freak out and sell? Were you hesitant to buy because you feared what the market would do?

So many times we think of a risk tolerance assessment as a one-time deal. Something you determine at the beginning of your relationship with your advisor, or through a conversation you and your spouse had 6 years ago. But your risk tolerance doesn't work like that. It's a fluid belief system shaped by your experiences and your stage in life. If you are unsatisfied with your returns, it could be an advisor performance issue, but more likely than not your expectations are not matched with your risk tolerance allocations. This is a problem.

If it takes a market correction to force yourself to reevaluate your risk tolerance, okay, but you'd better serve your financial life if you reevaluated regularly. Why not now?