Always Have a Cushion. You never want to be in a position where you’re forced to sell your stock market investments at the worst moment. So it makes sense to maintain a financial cushion, if at all possible. We make sure our clients have an appropriate amount of income-producing investments such as bonds, REITs, MLPs, and dividend-paying stocks. We also diversify broadly within these asset classes: for example, we invest in government bonds, muni bonds, and corporate bonds. If stocks crash, we can sell some of those income-producing investments (ideally bonds, since they are liquid) and use
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