The argument for diversification
During her Bloomberg interview, Hooper’s main tip for investors was to diversify. But how do you know when you're diversified enough?
According to JP Morgan: "A widely accepted rule of thumb claims that a properly diversified portfolio must have no more than 10 to 20 percent of total investment assets in a particular stock".
Beyond making sure you aren't exclusively invested in a single stock, you also may wish to consider you're invested beyond a single asset class.
For instance, when the stock market falls, real estate prices may still hold steady. Holding assets across multiple asset classes provides you with a cushion if one begins to fall.
FNRP offers a way for accredited investors to tap into commercial real estate with its fleet of grocery-anchored retail properties, offering historically strong return potential.
Their turnkey solutions simplify investing in commercial properties, which are leased to popular brands like Kroger and Walmart and therefore likely to remain desirable. Investing with FNRP can provide a steady stream of income without the hassle of becoming a landlord.
“Lack of fiscal prudence”
Hooper also explained to Bloomberg, “We're seeing countries struggle with fiscal prudence, and that will have ripple effects for investors.”
If the trickle-down effect of rising debt were to indeed hit American investors, then it would be helpful to audit your personal finances — ensuring your investing and spending habits are aligned with your financial goals.
The average American spends $273 monthly on subscriptions alone, according to a study by West Monroe. Tools like Rocket Money can help you regain control of your spending.
Their platform categorizes your monthly expenses and shows your cash, credit and investment balances all in one place. The app will also check to make sure you’re not wasting money on any subscriptions you may have forgotten about, potentially saving you hundreds of dollars a year.
By trimming unnecessary expenses, you can redirect funds into investments that better align with your financial goals for 2025.
You can also make sure that you're making the most of your current spending. When you make a purchase on your credit or debit card, Acorns automatically rounds up the price to the nearest dollar and places the excess into a smart investment portfolio.
Right now, when you sign up for Acorns, you can get a bonus $20 bonus investment to start growing your savings.
Watch out for “yellow flags”
And although many large companies' stocks have seen a robust recovery, Hooper warns we shouldn't get our hopes up. “There are yellow flags in the stock market that suggest we’re not out of the woods yet,” she said on Bloomberg.
Elevated valuations and overreliance on tech stocks have heightened risks for traditional stock portfolios.
Platforms like Masterworks and American Hartford Gold (AHG) are two unique and innovative ways to diversify beyond the potential tech bubble.
Masterworks enables access to blue-chip art investments, a class historically resilient to market downturns. And it’s a strategy adopted by wealthy investors, with 83% of wealthy Americans under 43 already collecting art or wanting to.
Normally, only the top 1% of investors would be able to diversify with art like Picassos and Banksys. But with Masterworks, you can easily diversify into this asset class without needing millions or art expertise.
With a team that’s been working since 2019, Masterworks investors have realized representative annualized net returns like +17.6%, +17.8%, and +21.5% (among assets held for longer than one year)
Then there's gold, which is traditionally considered a safer investment during times of stock market volatility.
For those seeking safety in tangible assets, American Hartford Gold (AHG) helps investors include precious metals such as gold in their retirement accounts.
A gold IRA combines the tax advantages of an IRA with the inflation-resistant properties of gold. American Hartford Gold is a leading dealer of precious metals, and offers IRAs and direct purchases of precious metals and coins.
Sign up now for your free 2024 information guide to find out if a gold IRA is the right move for your retirement goals.
Opportunities for 2025
Despite the challenges, 2025 offers numerous opportunities for prepared investors. “The key will be identifying emerging trends early and aligning portfolios accordingly,” Hooper recommends.
It’s easy to feel daunted, though, if you don't exactly know where you stand or where to start. Partnering with trusted advisors can make a world of difference. With Vanguard, you can connect with a personal advisor who can help assess how you’re doing with your investments and make sure you've got the right portfolio to meet your goals.
Their hybrid advisory system combines advice from professional advisors and automated portfolio management to make sure your investments are working to achieve your financial goals.
All you have to do is fill out a brief questionnaire about your financial goals, and Vanguard’s advisers will help you set a tailored plan and stick to it.
Once you’re set, you can sit back as Vanguard’s advisors manage your portfolio. Because they’re fiduciaries, they don’t earn commissions, so you can trust that the advice you’re getting is unbiased.
