If you look up quotes about diversification from famous investors, you might come across one from renowned investor Warren Buffet that will certainly raise your eyebrows. It goes, “Diversification is protection against ignorance. It makes little sense if you know what you are doing.” Yet, we’ve always heard about diversification being one of the keys to success for retirement planning. How can these seemingly different ideas both be right?
We were planning to bring up this conversation before the Coronavirus pandemic hit, but now it just makes it even more important to discuss. You likely seek financial advice from lots of difference sources. And some of those sources will certainly have good intentions, but they’ll often give bad financial advice. Let’s look at some examples and explore the reasons why we have to be very careful from whom we’re taking this important guidance.
Time for an update on where we stand with the markets, the economy, and retirement planning as it relates to the Coronavirus pandemic.