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By Janna Herron
What to keep in mind when mixing politics and portfolios
Nearly an hour into a consultation with a potential new client, Nicole Burdick, a financial adviser focused on helping women plan for retirement and other goals, was surprised by a final question.
“I’m curious if you agree with the current administration,” the client asked. Burdick, founder of the planning firm Money Maven Financial, said she could tell the woman was a “little uncomfortable” about asking the question.
Burdick shared the experience in a LinkedIn post, wondering if other people had asked their advisers something similar, or if other financial planners had received the same question.
Read: Who’s freaking out the most over the stock-market dive? It depends on who they voted for.
The post set off a heated debate, said Burdick, who ultimately had to block some commenters. But the issue is important to consider, especially as the partisan divide in the U.S. deepens, and because trust is paramount in the relationship between a financial adviser and a client.
Many of the financial planners MarketWatch reached out to said clients and advisers don’t necessarily need to see eye to eye politically in order to effectively plan for retirement.
“In most cases, it’s not about agreeing politically, but more about the adviser being in tune to the client’s values and priorities,” said Jamie Bosse, senior adviser at CGN Advisors in Manhattan, Kan. “No matter where someone falls on that political spectrum, a solid financial plan should be able to adapt to changing environments and still help them move toward long-term success.”
That doesn’t mean politics doesn’t come up in conversations with clients. It just doesn’t usually happen right at the outset, said Daniel Lash, a partner at VLP Financial Advisors in Vienna, Va.
“It’s usually over the course of working with somebody. Rarely, it’s the first thing,” said Lash, who works outside Washington, D.C., and has many clients who work for the federal government. “Around here, everything is about politics.”
Politics and portfolios
Bosse finds that a client’s political beliefs often reveal themselves when the person is especially worried about the direction of the country or the economy.
“If they’re uncomfortable with who is making decisions or the decisions that are being made, then they ask, ‘Is this impacting our portfolio?'” she said.
In fact, it’s the client’s own political beliefs that can get in the way of making prudent retirement investing decisions, especially after presidential elections, several financial planners pointed out.
Some may consider derisking their portfolio if their preferred candidate didn’t make it to the White House. A retiree may rashly shift more of their investments to cash.
That’s a huge mistake, experts said.
“Look back over the nation’s history. We’ve had administrations that were firmly to the right, administrations that were firmly to the left, and there are still plenty of great companies out there that turn terrific profits that are worth the investment,” said Glenn Downing, a certified financial planner at CameronDowning Inc. in Miami.
Regardless of the political party in power, stock-market returns have overall been positive over the last century. According to a WT Wealth Management report, between 1926 and 2023, the average annual return of the S&P 500 SPX under a Republican president was 9.3% and under a Democratic president it was 14.8%.
In other words, if you cashed out, you missed out.
“Whether you’re rooting for the blue team or the red team, being invested is better than not being invested,” said Christopher Boyd, a certified financial planner at Wealth Enhancement in Hyannis, Mass.
Read: I’m a widow with $200,000 in a brokerage account. So why am I treated so poorly?
Working with advisers, no matter the politics
It’s still prudent to ask advisers about their investing strategies with your values in mind, said Tanja Hester, the author of a 2021 book titled “Wallet Activism: How to Use Every Dollar You Spend, Earn, and Save as a Force For Change” and a former MarketWatch contributor.
“A lot of folks might say we are sworn to be nonpartisan, and that’s all well and good, but if they’re not someone who is focused on putting together ethical investing portfolios, [they may] put a plan together that is just financially driven [with] a lot of investments you don’t want to be in,” Hester said.
Then there’s a matter of trust, which is foundational to the adviser-client relationship.
That was behind the question the prospective client posed to Burdick about her political beliefs. The woman, who Burdick said is on disability and going through a divorce, inherited her soon-to-be ex-husband’s financial planner, who she described as a big supporter of the current administration. Her interactions with the planner were fraught.
“[Financial planners] ask such personal questions,” Burdick said. “She was basically just asking me, ‘Are you a safe person to be this vulnerable with?'”
Situations that might arise where such vulnerability exists could involve a client who is transgender and wants to borrow from their 401(k) for surgery, or a couple, one of whom is a green-card holder, who are deciding where to live in retirement. These situations involve what have become hot-button political issues: gender identity and immigration.
“That’s a fair point,” Boyd said after considering these hypotheticals. “You can see why someone who has those family dynamics, they want to feel secure with whoever they interact with – that they’re not unwelcome.”
And it cuts both ways. Someone who wants to set up a donor-advised fund that directs money to conservative causes, for example, might feel judged by a more liberal-minded planner.
“It’s not that you have to agree on every single issue, but we as advisers have beliefs, viewpoints, philosophies, ideologies that influence our work,” Burdick said. “It’s important for us to be aware of how those beliefs show up.”
Read: Do you want to retire abroad? Ask yourself these 10 questions first.
Janna Herron is a freelance journalist focused on personal finance, the economy and consumer behavior. She’s a co-author of the forthcoming book “Retirement Bites: A Gen X Guide to Securing Your Financial Future.”
-Janna Herron
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
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08-25-25 1555ET
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