With Fall arriving, it’s time for all of the familiar signs of the season – sweaters and jackets, cooler weather, and pumpkin spice lattes everywhere you look. But this year, Fall coincides with another season, and we’re all naturally a bit preoccupied by it.

That, of course, is election season, and in the world of wealth management, it’s always accompanied by questions like, “What impact could the election have on my investments?” and “Should we change our investment strategy based on the potential volatility of the election results?”

It’s very tempting to try to guess or forecast what might happen in the short-term as a result of a presidential election – to tinker with your investment plan to capitalize on a predicted upturn or mitigate a potential downturn. But basing your and your family’s financial future on a series of guesses will almost certainly net you less in returns in the long run.

Who’s better for the economy?

It’s a long-standing debate: Does the American investor thrive more when Democrats are in office, or when Republicans are in office? An August report by Schwab cited a study on this very topic. It notes that if you take 1961 as your start date, and you invested $10K through the end of 2023 but only during the years Republicans were in office, your nest egg would have grown to $102K – not bad!

If you invested that same amount during that same time frame but only when Democrats were in office, it would have grown to $500K, which seems even more promising.

But here’s the kicker: If you invested $10K from 1961 through 2023 and stayed in the market the whole time, your $10K would have grown to $5.1M.

The moral of the story? The real frontrunner is not a Democrat or a Republican; it’s time.

The long-term is made up of the short-term.

At N1 Advisors, we focus on helping you plan for long-term financial freedom. But it’s important to remember that the long-term is made up of a series of short-term moments, some of which will be up, and some of which will be down. Those ups and downs can feel harrowing as they are happening, but they all pass, and the overall trajectory of the market has trended upwards for the almost 100 years it has been tracked.

When it comes to presidential elections emotions can run high, as can the impulse to just do something to better position yourself for what you think may come. History shows us, however, that the market is far less influenced by obvious events like the outcome of an election and far more influenced by events no one could have seen coming.

In fact, since the S&P started tracking returns in about 1926, there have only been four times where the market has experienced a downturn in a presidential election year, and none of those downturns were related to the election:

• 1932 saw us in the grip of the Great Depression.
• In 1940 Europe entered WWII.
• In 2000 the tech bubble burst.
• 2008 gave us the global financial crisis.

All of this is to say that if you have a sound investment strategy, it’s not going to change with each prevailing political wind.

Three things matter.

At the end of the day, a sound investment strategy hinges on three steps:

1. Establish a plan. We work with you to ensure that your plan is based on two essential components – it has to be purpose-driven, and it has to be something you can stick with, no matter what.
2. Develop an investment strategy that serves and aligns with your plan. We create your individualized plan by taking all of the factors we can into account – your projected income and expenses, your goals – and building in the resiliency to weather the unknowns that will come along in any investor’s life.
3. Stay invested. Spikes and crashes will happen over the course of the years you invest, but we design your portfolio to weather ups and downs so that you don’t have to be distracted or distressed by them. With a carefully crafted plan, you can stay the course and reap the overall return on your investment in the long run, whoever is in office.

Vote for time.

Whatever happens in November, the Schwab study shows us that the real winner is time. You can try to guess at how to tweak your investments to coincide with whether a Republican candidate or a Democratic candidate is at the helm, but neither path will yield as good a return as simply sticking with the plan throughout.

At N1 Advisors, It’s our honor to stand with you through every season as you prepare for the future you dream of for yourself and your family – a future of financial freedom, well-earned by steadfast perseverance through the ups and downs of life, politics, and the market. Time really is on our side, and we’re grateful to work with you to leverage it for your success!