The Financial Planning Brief — August 2026

Markets Are Near Record Highs. What Should Investors Actually Do?

There is no shortage of financial headlines right now.

Markets have recently reached record highs. Inflation has moderated but remains above the Federal Reserve's 2% target. The labor market has softened, while interest-rate policy remains uncertain.

For investors, that can create a natural question:

Should I be doing something differently?

Our view is that the answer should begin with your financial plan—not the latest market headline.

Market Perspective

The S&P 500 recently reached another record high, even as investors continue to weigh inflation, interest rates, economic growth, corporate earnings, and geopolitical risks.

Record highs can make investors nervous because they create the feeling that a market decline must be imminent.

But a record high does not tell us what happens next.

Markets can continue to rise after reaching previous highs, just as they can experience corrections at any point.

Instead of trying to predict the next move, we believe investors should focus on whether their portfolio remains appropriate for their goals, time horizon, cash-flow needs, and risk tolerance.

Read more: The Market Is Near Record Highs. Should Investors Be Worried?

Financial Planning Question of the Month

What Should Your Financial Plan Actually Tell You?

A financial plan should do more than project how much money you might have in the future.

It should help answer questions such as:

• Can I afford the lifestyle I want?
• When can I realistically retire?
• How much investment risk do I actually need?
• How would my plan hold up during a market downturn?
• How can I manage taxes?
• What risks could derail my plan?
• What happens to my family and assets if something happens to me?

The purpose of planning isn't to predict the future perfectly.

It is to give you a framework for making better decisions as the future unfolds.

Read more: What Should Your Financial Plan Actually Tell You?

A Financial Concept Worth Understanding

"Risk Tolerance" Isn't the Same as "Risk Capacity"

These terms are often used interchangeably, but they are different.

Risk tolerance is how comfortable you are with investment losses and volatility.

Risk capacity is how much financial loss your plan can actually withstand.

An investor might say they are comfortable with a 25% decline.

But if they need to withdraw a large amount of money from their portfolio during that decline, their financial situation may not have the capacity to absorb that level of risk.

Good planning considers both.

One Question to Consider

If your investment portfolio fell 20% tomorrow, would your financial plan require you to change your lifestyle—or would you have enough flexibility to stay the course?

The answer can tell you a great deal about whether your investment strategy and financial plan are working together.

Looking Ahead

The second half of the year is a good time to review whether your financial plan still reflects your current circumstances.

Consider whether anything has changed with:

• Your retirement timeline
• Income or employment
• Spending
• Major purchases
• Family circumstances
• Investment allocation
• Tax situation
• Estate documents
• Insurance coverage

Small changes can sometimes have meaningful implications when viewed in the context of a larger financial plan.

Our Perspective

Financial planning isn't about eliminating uncertainty.

It is about being prepared for it.

Markets will move. Economic conditions will change. Your personal circumstances will evolve.

The goal is to have a financial strategy that can adapt without requiring you to react emotionally to every change.

This material is provided for educational and informational purposes only and should not be construed as individualized investment, tax, or legal advice. Past performance is not indicative of future results. Investment involves risk, including possible loss of principal. Please consult your financial, tax, or legal professional regarding your specific circumstances.

Securities and investment advisory services offered through Osaic Wealth, Inc. member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced here are independent of Osaic Wealth.