The Long View: Why Strategic Planning Outperforms Short-Term Reactions

In today's world of instant notifications and 24-hour news cycles, it's easy to become fixated on daily market movements and current events. At Entrust Wealth Partners, we've observed that periods of heightened uncertainty often lead our clients to wonder whether immediate adjustments to their financial strategy are necessary. While these concerns are completely natural, our experience continues to affirm that maintaining a disciplined, long-term approach delivers the most consistent results over time.

Short-Term Noise vs. Long-Term Signals

Market volatility, geopolitical tensions, and policy shifts are nothing new in the financial landscape. What has changed is our constant exposure to these events through technology and media. This heightened awareness can trigger emotional responses that may work against your long-term financial interests.

Consider this perspective: Since 1980, the S&P 500 has experienced average intra-year declines of approximately 14%. Yet despite these regular downturns, the market has delivered positive annual returns in 32 of those 45 years (Source: JPMorgan Chase “Guide to the Markets”). This pattern illustrates an important truth: short-term volatility is a normal part of the investment journey, not a deviation from it.

The Benefits of Strategic Consistency

A well-designed wealth management strategy already accounts for periods of uncertainty. Here's why maintaining your strategic plan typically outperforms reactive adjustments:

• Compound Growth Preservation: Making significant portfolio changes in response to market movements can interrupt the powerful force of compounding that builds wealth over time.
   

• Reduced Emotional Decision-Making: A structured plan provides guardrails that help prevent decisions driven by fear or enthusiasm—emotions that historically lead to buying high and selling low.
   
• Tax Efficiency: Frequent portfolio adjustments can trigger taxable events that erode your returns, whereas strategic long-term positioning optimizes tax efficiency.
   

• Opportunity Capture: Market recoveries often happen quickly and unpredictably. Investors who remain positioned according to their long-term strategy capture these upswings automatically, while those who moved to the sidelines must make a second correct decision about when to re-enter.

When Adjustments Make Sense

While we emphasize the importance of strategic consistency, we're not advocating for a "set it and forget it" approach. Thoughtful, measured adjustments to your financial strategy are appropriate in several situations:

• When your personal goals or time horizons have shifted

• When significant changes to your family or business situation occur
• When tax laws or estate planning rules evolve in ways that impact your strategy

• When regular portfolio rebalancing is due

The key distinction is that these adjustments respond to changes in your life circumstances or the regulatory environment—not to market movements or news cycles alone.

Our Current Perspective

As we navigate the current environment in 2025, we're mindful of the various factors influencing markets and economies globally. Rather than reactive portfolio overhauls, our approach emphasizes:

• Strategic rebalancing to maintain appropriate risk levels

• Tax-loss harvesting opportunities that may arise from market movements

• Regular review of your financial plan to ensure ongoing alignment with your goals

This disciplined approach allows us to acknowledge current realities while maintaining the strategic consistency that has historically served our clients well through various market cycles.

We understand that maintaining a long-term perspective can be challenging. If current events have you thinking about your financial strategy, we encourage you to channel that energy productively. Rather than considering significant portfolio changes, this may be an excellent time to:

• Review your financial plan to reaffirm your long-term objectives

• Ensure your asset allocation still aligns with your goals and risk tolerance
• Discuss any changes to your personal situation that might warrant strategic adjustments

• Confirm that your estate planning documents reflect your current wishes

And, as always, we can help! If you'd like to discuss your specific situation or simply gain reassurance about your current strategy, please don't hesitate to reach out. Contact us today at (860) 838-3730 or email us at entrust@entrustwp.com to schedule a conversation about your wealth management strategy.

Rebalancing a portfolio may cause investors to incur tax liabilities and/or transaction costs and does not assure a profit or protect against a loss. 

Asset allocation does not ensure a profit or protect against a loss. 

Investing includes risks, including fluctuating prices and loss of principal. No strategy assures success or protects against loss. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.