The election is over, and emotions are running high. Whether you’re thrilled or disappointed by the outcome, one key principle applies to everyone: stay focused. Craig Sullivan of Sullivan Financial Partners shares insights on why maintaining your momentum and sticking to your financial plan is essential, no matter who’s in office. Here are the key takeaways.
1. Election Results and Market Trends
Historically, the six months following presidential elections tend to perform well for the markets, with value investing often outpacing growth. Value investments have averaged returns of over 6.5%, compared to 3% for growth during these periods. While this is interesting to note, it doesn’t mean you should make drastic changes to your strategy. Stay informed, but stay the course.
2. Economic Outlook Post-Election
Periods of reduced government spending, like those seen in the late 1970s and early 1980s, have historically aligned with robust economic growth. With a potential focus on curbing spending in the new administration, this trend could repeat. However, this is simply context—not a call to alter your financial plan.
3. The Cost of Investing Based on Politics
Investing based on political leanings is often a costly mistake. Historical data reveals that a $10,000 investment starting in 1949 would have grown to just $80,000 if invested only during Republican presidencies and $450,000 during Democratic presidencies. But here’s the key: if that same $10,000 had been left invested, regardless of who was in office, it would have grown to over $3.8 million. The lesson? Politics don’t drive your financial success—your long-term plan does.
4. The Power of a Financial Plan
No matter the political climate, a well-thought-out financial plan is your strongest asset. Markets will fluctuate, policies will change, and administrations will come and go, but your ability to stick to a disciplined, long-term plan is what ensures financial success.
Final Thoughts
The election may have sparked uncertainty or excitement, but your financial strategy should remain steady. Focus on what you can control, not the political noise. If you need help crafting or adjusting your financial plan, Sullivan Financial Partners is here to guide you toward a confident retirement. Remember, the key to success is sticking to the plan—no matter who’s in office.