The Market Will Crash!

15 Sep 2014

All right, now I have your attention. You probably assume I mean the stock market, right? Remember what they say about assuming. Well, I have no clue when or if the stock market will crash, but just for fun let’s take a look at some facts.

The current Bull market is almost 5.5 years old (the average bull is 4.05 years) and the S&P 500 is at a new high, almost daily. The last two bulls peaked around a 100% gain (the current bull is over 190% up from 3-09 highs). The previous two corrections were losses of -57% and -49% for the S&P 500. Scary stuff for sure.

There is no way to predict the beginning and end of the next bear market. As I have said many times before, “I cannot predict what the market will do, but I can predict how the average investor will react!” In our opinion there are a few ways you can prepare yourself for when and if the next bear market arrives:

1. Rebalance your portfolio now.
2. Segment your money into responsibilities – we use the Premier Bucket System (Buckets #1, #2 & #3).
3. Have realistic expectations and a personal fair rate of return goal.
4. Know which phase you are in – Accumulation or Distribution.
5. Review now with your advisor to discuss any concerns.
6. Own many different asset classes that are non-correlated.

Even though these methods don’t guarantee anything, they should make your retirement journey a bit more smooth and give you added confidence when the going gets tough. History has shown that those who have a long-term perspective and are patient have been able to achieve fair returns over time.

Good Luck!

Jeffrey A. Johnston, ChFC
Investment Advisor Representative


Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Premier Investments of Iowa, Inc. are not affiliated.


Jeffrey Johnston

Jeffrey is originally from Solon, Iowa. He currently resides in Swisher, Iowa with his wife, Prudence, and his three children, Seth, Ian, and Roman. He graduated from the University of Northern Iowa in 1989, where he majored in Finance and Investments. He has 24 years of experience in the investment and estate planning business. He is currently the President of “Premier Investments of Iowa, Inc.” Jeffrey’s main focus is Estate and Investment Planning for Senior Citizens and Pre Retirees. Jeffrey became a Chartered Financial Consultant (ChFC) in 2001. He is the author of many articles on industry related topics and he is a frequent seminar presenter. He is a Board Member TRIAD Linn County Seniors Against Crime, and he is also a past Board Member of the Heritage Area Agency on Aging Task Force. He is a member of CEO Roundtable in Cedar Rapids, a Daybreak Rotary Member, and a member of the Cedar Rapids Estate Planning Council. In March of 2009, Jeffrey became the host of the Premier Investments of Iowa Financial Hour which airs every Tuesday Evening from 6PM -7PM, on WMT 600 AM Radio. In his free time he enjoys golf, fishing, scuba diving, traveling, and coaching son’s basketball teams.