Newspaper article Charleston Gazette Mail

What Does 'Brexit' Mean for Your Retirement?

Newspaper article Charleston Gazette Mail

What Does 'Brexit' Mean for Your Retirement?

Article excerpt

Unless you have been hiding out in a remote location the past few days, you have no doubt seen the news that the United Kingdom has voted to leave the European Union. The markets, for the most part, responded with increased volatility and a negative direction.

As an investor preparing for retirement, what should you do in response to this event? I believe that this is one of those instances where it is good to step back and take a little longer view to gain proper perspective on the situation. I think it is also a good opportunity to preform a "check up" to insure you are taking the steps that align with your goals and tolerance to volatility.

Personally, I am somewhat amused by the alarming discussions filling our airways and publications the past few days. It is as if the United Kingdom is going to roll up and be tossed in history's dust bin.

An independent United Kingdom still is the fifth largest economy on the planet, a nuclear power, a veto holder on the UN Council, a trading giant with a footprint stretching the globe. Also, the United Kingdom possesses established institutions and democratic traditions dating back to the Magna Carta in 1215.

I'm guessing these guys are going to continue to be an important player going forward.

Will the vote upset some trade agreements currently in place? Yes. Will new agreements be formed in place of the EU agreements? Yes.

I think its a stretch to think that the outcome of the new agreements will automatically be bad in the long run. Britain actually buys more goods from Europe than it sells. This circumstance gives Britain strong leverage in negotiating future trade deals.

The outcome of this is yet to be determined and markets don't like uncertainty, but I believe that over time, we will find that the extreme what ifs won't come to pass.

Since none of us know what news story will dominate tomorrow's headlines, I believe that is important to use asset allocation strategies to dampen volatility as you move toward your financial goal. …

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