The market keeps setting records. Your balance is up, the headlines are calling it a rally, and on paper it’s hard not to feel some pride when you look at your account.
The strange thing is that even near all-time highs, plenty of people don’t actually feel that flush. The mood on the ground hasn’t caught up to the market, and a gap like that is worth paying attention to.
Part of that unease is wisdom. A rising market makes almost any portfolio look right. It’s the drop that tells you whether your investments actually fit you, and by the time it arrives, the window to prepare has already closed.
Does Your Risk Level Have a Shelf Life?
That “fit” has a name. Your risk score is a read on how much risk you’re genuinely comfortable taking and how much your plan can afford to take on your behalf. We use a tool called Nitrogen (formerly Riskalyze) to give it a value between 1 and 99, turning a fuzzy gut feeling into something you and your advisor can actually work with.
Part of that number is temperament and part of it is circumstance.
Temperament barely moves. If a sharp drop kept you up at night ten years ago, it probably still does.
Circumstance is what drifts. A new job, a growing family, a business sale, a paid-off house, a closer view of retirement. Your personality holds while your situation moves, and a score that was perfectly accurate five years ago might not describe your life anymore.
A more complicated life doesn’t automatically mean a more cautious portfolio, just as more money doesn’t automatically mean a bolder one. It cuts both ways.
- Client A is fine missing some gains because they sleep better at night with less risk, and they keep more in cash than most.
- Client B, in nearly the same situation, sees calculated risk as the very thing that got them here. The ups and downs are motivating, not nerve-wracking.
Picture someone who set their score five years ago. Their temperament hasn’t changed much, but a business sold, the mortgage got paid off, and retirement moved from “someday” to a real date on the calendar. Maybe the right answer now is more risk, maybe less. The point isn’t the direction. The point is that if nobody has asked the question in five years, the portfolio is running on a five-year-old answer.
How Often Should You Look
Industry best practice is vague. It says revisit “periodically,” which is not exactly a calendar reminder. Some people check every year, and there’s nothing wrong with that.
Our view at Tannery: every three years is the minimum, and sooner any time life changes in a real way.
The Other Way Your Portfolio Drifts
A stale score is one way your portfolio and your risk stop matching. A market run-up is the other, and it’s sneakier, because nothing about it feels like a problem.
When stocks climb, they grow into a bigger slice of your portfolio than your target calls for. Left alone, your actual risk creeps up at exactly the moment the market is most expensive, which is the opposite of what you want. Rebalancing trims the winners back to plan, keeping your risk where it belongs and enforcing the discipline of selling high, which almost nobody manages on their own.
So a record high isn’t a reason to relax. It’s a reason to check two things:
- Is your risk score still right?
- Is anyone pulling your allocation back to target?
How to Assess Your Situation
If a record-high market has you feeling good, this is a fine moment to ask a few less comfortable questions. The right ones depend on how your money is actually being handled right now.
- In a target-date fund? It sets your risk off one input, the year you plan to retire. Two people retiring the same year get the same glide path, whether one panics at every dip or barely notices. It can’t see your temperament, your other accounts, your spouse, or a business on the side. A reasonable default, not a personalized fit.
- Someone manages it for you? The question isn’t whether they’re good at it. It’s when they last asked about your risk instead of just your returns, and whether anyone is pulling your allocation back to target when a market like this pushes it off.
- A robo-advisor or automated account? It rebalances on a schedule, but back toward the risk level you picked at signup, maybe a few years and one very different life ago.
- Handling it yourself? When did you last rebalance, and are you the one who’s going to do it the next time the market runs?
Underneath all of them sits the same question:
Do you actually know how your money is being managed right now, or are you assuming someone has an eye on it?
None of these are obvious to ask at a market high. All of them get expensive at a market low.
Where Tannery Company Comes In
Your risk score isn’t a get-to-know-you exercise. It’s the benchmark we manage against, and we read it across your whole financial picture rather than one account at a time.
If a large share of your net worth sits in something safe, a single brokerage account can look aggressive on its own and still be perfectly balanced once everything is in view.
That’s also the part that’s easy to miss on your own, in a hands-off managed account, or with an advisor who set the allocation once and moved on. We keep portfolios aligned to your score, we watch the market so you don’t have to, and keeping the score itself current is the part we partner on with you.
It all comes back to a single question we ask every client, “What do you want your money to do?” A risk score that reflects who you are today is how we keep the answer and the portfolio pointed in the same direction.
If it’s been three years or more, that’s not a someday task. Email us this week — at wealth (at) tannerycompany (dot) com — and we’ll take it from there.
