Safeguarding your nest egg: How to weather a market downturn and protect what you’ve earned

BILL NORTHEY: Hello, and welcome to today's webinar presented by US Bank Wealth Management. I'm Bill Northey, senior investment director with US Bank Wealth Management. With inflation running at four decade highs, rising interest rates, and a recent capital market volatility, you may be asking some of the same questions that many of our clients are asking. How can I protect what I've worked so hard to earn over the years? 
So before we get started on our topic and introduce our guests, I'd like to go over a few housekeeping items to help familiarize you with the platform that we're utilizing today. So you have the ability to customize and control your viewing environment. You can resize any of the windows that are available to you by simply dragging on the edge of each of those boxes. You have the ability to hide a window that you would like to remove from your view by clicking the X in the upper right hand corner. 
The buttons along the bottom of your screen also allow you to control the environment. So you can restore any windows that you may have previously closed simply by clicking the Refresh button. And also, along the bottom of your screen, you'll see a tab labeled Questions. And if you click on that tab during the course of our time together today, you can submit any questions that you may have. And if the question isn't specifically addressed, we'll be sure to follow up with you directly after the conclusion of our presentation. 
So today, I am joined by two wonderful guests. And I'm very pleased to have them both with me, Eric Freedman, chief investment officer for US Bank Wealth Management, and Amit Poddar, Minnesota market leader and senior wealth strategist for US Bank Private Wealth Management. So Eric, Amit, thank you for being here, and welcome. We're very pleased that you're going to be a part of our conversation today. 
ERIC FREEDMAN: Thanks a lot, Bill, great to be here. 
AMIT PODDAR: Thanks, Bill. 
BILL NORTHEY: So today, our ultimate goal is to have you walk away, our audience to be able to walk away, with some real practical strategies that you may want to consider in the current environment. So we're going to go over a couple of different topics, which you can see on the agenda today. We'll start our conversation with a review of the current market and economic landscape, something that is very top of mind for most of you who have joined us. 
We'll also discuss some strategies that you may be able to employ to protect against a market downturn. And we'll answer some questions. We're going to introduce a new format of common questions that we receive and have our panelists answer those questions in and around investing, certainly; the real estate market; and then ultimately, cash and liquidity. 
So with that, let's go ahead and get started to our first portion of today's conversation. And Eric, I'd like to bring you in, as our chief investment officer for US Bank Wealth Management, to talk about, what's going on in the current market and economic landscape? 
AMIT PODDAR: Absolutely, Bill. And great to be with everybody today, and thanks for the opportunity. Really what we want to talk about, just initially, is these three circles you see on the slide here, the growth slowdown, the levels of inflation and interest rates, and certainly, this whole concept of assets repricing lower. I'll go through these in brief detail. 
So in terms of the growth slowdown, maybe one way to think about this is the idea of last year, the economy ran at a very, very fast pace, like at almost like a track meet. The 2021 track meet, the loop that we ran, if you will, was a very fast one. Part of that was, of course, us returning as a global society back to activities that we liked to do before the pandemic emerged and really, restarted those, in a way. 
And so that led to a real strong level of broad economic activity. So we thought, even before some of the challenges that have emerged this year, that there is going to be a natural decline, if you will, in the pace. Now, that doesn't mean that we're going to go to a walk pace or even walk backwards. It just simply means that the economy is going to slow down a little bit from a very strong case of 2021. 
So I think that what you're seeing in a broad purview right now is the notion of an economy that's really trying to adjust to this notion of inflation. And inflation, as we've said for a long time, had been really a challenge for the economy. In other words, the economy had not been able to really sustainably grow at levels that produce inflation. 
And then we have the pandemic. We had there's lots of reasons why we've seen inflation pick up. And these are very apolitical reasons, but certainly, supply chain issues, policy stimulus that was really meant to fuel activity during the depths of the pandemic, all those had really lagged effects, if you will, that have driven prices higher, not just in the US, but across the globe. They've really manifested, as many of you know, in prices at the pump, in grocery costs, in shelter costs. 
Whether you rent, or if you're looking for a new home, if you're trying to buy a used car, there's almost no corner of the world that has not experienced a level of increased inflation. So again, you've had the challenges with trade, as you see in the slide. We've had some slowdown in China as well. But the bottom line is that you've seen the confluence of higher inflation, which we'll touch on in just a little bit, but also, the idea of just a gradual slowdown from 2021 activities. 
And the other thing to point out is that corporate earnings, which, again, if you think about it doesn't matter what sector, whether it's software, whether it's energy companies, or consumer discretionary companies, like restaurants or other for travel and leisure, there is a net impact, if you will, of the current economic trajectory on earnings. So we, again, saw an environment where companies were really challenged in 2020. Then they bounce back in 2021. 
So I think that the key thing, though, as we're thinking about the path forward, is that we've seen the slowdown in 2020. Then we saw this really quick, abrupt jump back in 2021, and then a natural degree of a slowdown so far this year. And the key question, and in fact, one that Bill and I, when we were meeting earlier today talking about this, is what might the extent of that slowdown manifest itself into for the rest of this year? I mean, let's just think about it. 
So if you look at the confluence of issues that are in front of us right now, you have this environment where consumers are moving away from doing more things, sheltering in place-driven activities, to more experiences outside of the home, so driving, flying, staying in hotels. Now, one of the things that we're thinking about is just how sustainable, if you will, are current activity levels, as we delve deeper into this year, if inflation stays pronounced? 
It's one thing to fill your car up for maybe one or two summer trips, but if you take a third, you may think twice about it, if you will, because of the higher costs that you're facing as an individual. So again, it's this notion of some activity levels picking up, but still the potential for a rethink of some expenditures as we get deeper into this year. 
If you go to the next slide, please, one of the things that we want to emphasize is this notion of inflation. We'll spend just a little more time talking about that. So a couple of things, we talked about prices at the pump, grocery costs, shelter costs, cooling, heating-- obviously, we're not thinking about heating so much right now in the Northern Hemisphere. But in general, there has been a massive increase in costs at a variety of different price points. 
And so this idea of us reaching a 40-year high in consumer prices and the consumer price index, that takes a toll on people. And the Federal Reserve, or the Fed, which is the US Central bank, which is really in charge of regulating interest rates to try to thwart either too much inflation-- or in some cases, they actually try to stoke a little bit of inflation, if the economy is just not growing. 
So we went from a period in 2020, Bill, where the economy just wasn't growing because of the pandemic. And then we had a lot of pro-growth stimulus policies, as well as some lag consumption. And if you add on top of that some challenges, obviously, with Ukraine and Russian supply chains, and China, you have a real mix of variables that's driven inflation much higher. 
So the Fed is trying to thwart those increases by raising interest rates. Now, some would argue that the Federal Reserve is a little bit behind, and so they have to raise rates more quickly to catch up. And that's something that we're seeing play out in capital markets right now. 
If you go forward one more slide, one of the things that I think is also important to think about is, just what's that meant on a trend basis for the broad economy, again, for financial markets? And I think the key thing to consider here, Bill, is that the trend has been lower in prices of stocks, as well as in prices of bonds. That's actually never happened before on a sustained basis over the course of a calendar year. 
Normally, you see-- that's, I guess, my track analogy. You normally see stocks zig and bonds zag. Unfortunately, this time around, we've actually seen them both fall. Now, stocks that have fallen much, much harder than bonds have. But both have lost value in most categories. And so that's led to some challenges at the portfolio level. 
Now, we'll talk about some strategies down the line. But of course, these are all interrelated points. As the Federal Reserve raises interest rates, that impacts all asset prices. If I have a bond that yielded, let's call it 4%, and then the Fed raises interest rates, well, that 4% bond is actually no longer competitive. It actually has to go up in the yield or down in price. 
And so in a way, Bill, it's actually a positive over time for interest rates to reset higher. But the journey, as we've seen thus far this year, has just not been pleasant. We'll talk about strategies a bit deeper on this call on how to really think about that and navigate from this point forward. 
BILL NORTHEY: Thank you, Eric. And you've done a nice job of capturing many of the publications that we've actually made available to our clients out on usbank.com/marketnews around the repricing environment. And so thank you for that, that contribution. 
Amit, let's bring you in here. And now that we've reviewed the current economic and capital market landscape and some of the factors that are influencing it, we'd like to transition to some of the practical strategies that you can think about from a portfolio standpoint to protect against some of these market downturns. 
AMIT PODDAR: Absolutely, you bet, Bill. Before we get into the strategies, let's just see what we can do from an overall external factors and how they impact that. So first, as Eric mentioned, there's always going to be external factors that impact the choices that you make related to your investment portfolio. But your personal circumstances and goals are a bigger priority for you individually and as a family. 
The best thing you can do to keep on track with your plan is to revisit your financial and investment goals. First, know where you're headed. Have a comprehensive financial plan that maps out your goals, and revisit that plan regularly with a financial professional. 
If you have one, that's great. If you don't, please connect with a financial professional to build one. Especially when it comes to investments, as Eric illustrated, it's important to know what your long game happens to be. With volatility right now, as we're experiencing, it's often an easy time to become emotional when news and markets are moving fast. But it is important to stay focused on a personal long-term objective. This allows you to adapt your portfolio to match your plan, versus attempting to invest on a short-term noise. 
Second is know what you need. Once you know what your goals are, you can easily know what you'll need to accomplish them. Whether it is money in the short term, long term, medium term, this will inform the strategies that make sense for your unique situation. 
And the last thing is evaluate your level of risk. You need to evaluate the risk that you're taking. Is that appropriate for you and your family? Are you taking enough risk? Is it too much? Make sure that the risk tolerance that you're taking matches up with the goals that you have. 
And we often find that folks are more loss averse than risk averse, which means that folks are OK to take the risk when the going is good, and the markets are going high. But they do not necessarily like the risk when the markets are on the downturn, as we find ourselves right now. While this is an understandable emotion, it does not necessarily make for a recipe for success. So having a plan with the appropriate amount of risk allocation and staying with it will help you in the long run. 
BILL NORTHEY: Yeah, it's always important to understand the behavioral finance aspects of this, as well, Amit. Certainly appreciate that. One of the things we'd like to do-- and I appreciate the fact that you've always tied this back to one of the things that we communicate through all of our webinar series, of the importance of having a plan. And we'll have you take on some more detailed strategies that we should consider around uncertain markets as we move in your presentation. 
AMIT PODDAR: Absolutely, you bet. So here are a few of the strategies. So now that we know how the external factors affect ourselves and our plans, what can we do? So number one, reviewing your asset allocation diversification, as we discussed a minute ago, reviewing your risk tolerance and adjusting your asset allocation are super important. 
Different asset classes react differently to the market movements. And we need to review how that allocation affects you and diversify your individual portfolio. The portfolio should also be rebalanced on a periodic basis. 
Second piece is taking advantage of a concept called dollar cost averaging, especially during the volatile markets. As Eric illustrated, the events that we see in front of us in market, timing the market can be really problematic. By starting a consistent, predetermined savings plan or increasing your 401(k) contributions, you can avoid trying to time the market, while still potentially benefiting from the market downturns. 
A dollar cost averaging is a systematic approach to investing, in which the investments are made on a predetermined, consistent basis. The main benefit of this strategy is the potential to lower your average cost you pay for an investment by buying more shares when the prices are lower and fewer shares when prices are high. And probably the most important point in all of this is stay invested. 
And as Bill and Eric would know, especially in the volatile market that we are seeing right now, we get this question quite a bit. Should I consider just selling off and moving into cash so that I don't see the downturn? While it may be tempting to do so, that is exactly the opposite of what we tell our clients to do. Our guidance is that it's best to stay invested throughout the volatility. 
Attempting to time the market to maximize gains or minimize losses, it becomes a fool's errand and can be really risky. Among the choices that the investor may consider to help guard is, again, try and find your plan, stick to the plan, and also, stay invested in stocks. Because that is the one way you can stay ahead of inflation in the long run. 
BILL NORTHEY: Yeah, thanks for that. Those are good points. And it's always important to come back-- [CLEARS THROAT]-- excuse me-- to those long-term objectives. Excuse me. 
So as I mentioned at the outset, today we're actually going to do a little bit of a new format, which is looking at some common questions that we get in our normal conversations with clients and people in our communities. And so what we're going to do is put forward these questions. And I'll ask the panelists to respond to each of them. So we're going to have Amit start with our first question here. And the question, Amit, is, how can I protect my retirement savings from inflation? 
AMIT PODDAR: Thank you. First of all, this is a very important point as you build your financial plan, is to have 6 to 12 months of your expenses in cash holdings. So once you have that, you have the cushion, if you will, if something were to happen to your business or your job, what have you, then if you have additional cash savings, you can consider adding more to your 401(k) allocation or contribute to your IRA, Roth IRA, or 529 plans, or your investment plans, as it may see fit. And sometimes, employers also offer matching contributions, that you should be really in tune with. Increase your 401(k) contributions there. 
BILL NORTHEY: Yeah, this is really a question that is a perfect crossover between investments and planning. And so I'd like to offer Eric an opportunity to respond here as well. So Eric, anything you'd add with this particular question/ 
ERIC FREEDMAN: Thanks, Bill, and I certainly agree with Amit's point in terms of the protection against inflation. And as this chart, which we put together in response to this question, illustrates, that typically, if you sit in cash for a prolonged period of time, it's generally not productive for you. And in fact, cash has long considered to be amongst the lower productive assets. 
And the reason for that is because there is no inherent inflation protection within cash. It tends to actually mimic, if you will, and actually be a slight discount to current inflationary levels. So if you think about even the environment right now, Bill, that the Federal Reserve is trying to catch up, if you will, to where inflation is, if you're sitting in cash and not earning a lot of interest on that cash and trying to keep up with inflation, there's a massive gap there. 
And so over time, and certainly recognizing that there are periods of time when stocks and bonds can lose value, like now, if you can stay involved, and if you can keep a mix of diversifying stocks across sectors, geographies, as well as bonds across credit quality and what's called duration, or just the maturity of those bonds, that tends to be a great inflation fighter over time. Certainly, over any very, very short period of time, which one could argue is 3, 6, even 12 months, that there can be a disconnect between a portfolio and levels of inflation. 
But over time, that more diversified mix of assets tends to really outrun inflation. Some of that is because corporate earnings, which are directly reflected in equity prices and stock prices, do take into account levels of inflation. If I'm a telephone company, and I'm thinking of how I want to charge customers, I'm going to keep in mind inflationary levels that I'm digesting as a company; same thing with a grocery store, same thing with other producers. 
So there's an inherent level of an inflation hedge over time within certain sectors. And I think that you're actually going to capture that. And I think this chart that we have in front of the audience actually shows just the record, if you will, which we think, again, past doesn't always portend. But we do think that will be a durable theme over the investment future as well. 
BILL NORTHEY: Yeah, thank you, Eric. And thank you, Amit. And Eric, you put forward a nice segue to our next question in talking about what has happened with the bond market as a result of rising interest rates and how investors should adapt their asset allocation strategies in response to that rising interest rate environment. So what would you share with our audience in response to this particular question? 
ERIC FREEDMAN: Thanks, Bill, and I think it is a very timely and relevant question, just given what we've seen so far this year. And again, to go back to the example I gave earlier, I think that there's oftentimes, a level of confusion about the relationship between interest rates and bond prices. They are directly related. In fact, they are inversely related, meaning if interest rates go up, that can be because of, as I mentioned earlier, the Federal Reserve, which has a target interest rates that it sets. 
And so as the Federal Reserve is increasing its interest rate targets, all other bonds reprice lower in price and up and yield. So said another way, if I have a bond that I bought for $100, and it has a 8% coupon payment, and it has an 8% yield, if I actually see interest rates go up, then the value of the bond and the open market may go down. But the interest that it pays, the coupon pays me, stays the same, obviously, as long as that bond keeps paying its interest, as it should. 
So I think what you're seeing in the environment right now is, for newly issued bonds that are carrying interest rates that are, again, of this new interest rate regime that the Federal Reserve is setting, those are resetting higher. And therefore, all other bonds are resetting higher as well. So without getting into a lot of technical spiel, if you will, bottom line is this, that any bond portfolio, one of the challenges is that as we're on a journey of higher interest rates, that's what we're experiencing right now. 
The Federal Reserve has very much telegraphed their intention to raise interest rates for the next couple of meetings. The market already anticipates that. And so what I want to be careful about is saying to investors, look, there's necessarily a lot more bond pain to follow. We do think that as investors think about their own bond portfolio, sometimes what happens is that people can reach for yield, or they go in to actually riskier parts of the bond market. 
The bond market tends to be a little less understood than the stock market. It's a bit more opaque. We don't see ticker symbols of stock prices on financial news networks-- I'm sorry, you see stock prices. You don't see bond prices. And therefore, it's a little more opaque, if you will. 
So we do think that a great thing to do in any environment is to make sure that the quality of your bonds really reflects the diversifying nature of the fixed income market, meaning high quality and lower duration, which is simply a technical way of saying own bonds that don't mature way down the line. In other words, own bonds that have cash returning to you as an investor more quickly than off into the distance, off in the future. 
So those are some tips that we think about in terms of quality meaning low default risk. What default risk means is a bond issuer that actually does not make good on their payments. So if I am an issuer, and Bill invests in me, if I were a fictitious company, and I all of a sudden say, hey, Bill, sorry, I'm going to pass on this year's interest payment, my price should go down. And it should reflect that default risk that actually, I am witnessing as an issuer. 
So , again managing quality through low default risk bonds, managing faster cash flows to you through lower duration fixed income, and again, spreading out across the various types of bonds that are out there, those are all good practices for a bond portfolio in this and in any environment. So those are some things that are top of mind, Bill, on that topic. 
BILL NORTHEY: Yeah. Yeah, thank you, Eric. So Amit, I'm going to bring you back in here to help us with our next question, which is directly related to, again, rising interest rate in the bond environment. What are some ways that one might think about structuring their bond portfolio to take advantage of the rising interest rate environment? 
AMIT PODDAR: Thanks, Bill. And this is an excellent question. In fact, Eric and I were discussing just exactly this even last week. One of the ways that we can do it, on top of what Eric mentioned in terms of lowering the duration, getting high on the credit quality, is the concept of laddering the bonds. So instead of owning the bond funds, you can buy a ladder of bonds, which basically, means you buy it with different durations over the set period of time. 
So the one that you have a lower duration bond matures sooner, and you can put it at the end of the ladder. So this way, the bonds that mature sooner can take advantage of the rising interest rates and grab that extra yield that Eric was talking about and continue building that ladder over and over and over again. So that way, you are participating in increasing interest rates in the bond market. 
BILL NORTHEY: Great, well, thank you, Amit. So we'll go ahead and move to our next question. And as Eric pointed out in some of his early commentary, this has been a bit of an anomalous year, 2022 year to date, where both stocks and bonds have been under pressure largely as a result of rising interest rates. So Eric, are there other assets or investment types that one should consider to help keep a portfolio or a financial plan on track? 
ERIC FREEDMAN: Yes, thanks, Bill. And this is a topic that also has come up, just scrolling through the questions that the audience has sent in. And please keep them coming in. They're very, very helpful to see. 
One of the things-- that a category that is often not as discussed is what's called real assets. So that would incorporate assets like real estate, like infrastructure, and subcomponents of the commodity markets. And so in general, one way to think about this category is that these are either sectors or companies that have variable cash flows. 
Think about a utility company as an example. So the services that you need to run water in your house or electricity, those tend to exist in any capital market environment, any economic growth environment. In fact, utility companies saw a lot more activity during the pandemic, because people were just home more often. And so categories like real assets incorporate real estate, which have actually stock and bond-like properties. 
If I'm a real estate company that owns a series of office buildings or multifamily homes, I have value that comes in the form of rents or operating leases from businesses. I actually charge them to be in my property. And then, of course, I have the physical asset value that over time, has been a reasonable inflation protector. 
Now, in this environment, just given some of the questions around what corporate landscapes may look like, maybe more people will be working from home. And so there may be some mixed usage of office buildings. Also, geographically, we're seeing lots of changes in terms of more suburban and even urban environments seeing a pickup in real estate activity. There are strategies. There are investment managers that actually capture all of these dynamics. 
So one strategy is to not just think about stocks and bonds, but also to incorporate this real assets category. And again, we give an example of real estate investment trusts. Real estate investment trusts aren't just individual houses or even offices. They can be storage facilities. They can be multi-use retail. They can be, again, a variety of assets and usage, if you will, that can provide both cash flow, as well as the opportunity for property price appreciation. 
So those are other things, Bill, that can be enhancive to one's portfolio, particularly that cash-generating nature. And this is something that Bill and I, in terms of our investment work, spend a lot of time thinking about, is, again, the levels and the ability to actually capture an income, in addition to just price return. That's an important part of anyone's portfolio. 
BILL NORTHEY: Yeah, thanks for those insights, Eric. Looking at our time, we're actually going to transition now into a couple of real estate related questions, so real estate and housing markets. Because as we know, as we think about the generic consumer, the broad consumer, out there, oftentimes the two biggest assets that they own are going to be their home and their investment portfolio. So we're going to take those a little bit in reverse order here and now go to real estate. 
So Amit, I'm going to bring you back in for this set of questions. So for our clients who have extra cash right now, a common question is, should they use it to pay off their house? Should they use it to invest? What insights would you care to share for our audience today? 
AMIT PODDAR: Sure. Thanks, Bill. It really depends on what the individual's unique situation is. So it depends on what your mortgage interest rates are. If you as an individual or a family have refinanced your home in the last two years, especially, or even the last five years or so, when the rates have been quite low, then you may have a really low mortgage rate. Right? 
And then some other factors are, how much do you have left to pay on your mortgage? If you're at the tail end of it, that's a different scenario than if you have refinanced just recently. What is your tolerance for risk? Right? Does it help you sleep at night if you were able to pay your house? How close are you to retirement? 
So these are some of the factors that people should consider at their individual level before they make this decision. One thing I will point out is people do look at each other and can potentially make a mistake that's not correct for them. So if your neighbor or your friend is paying off their house does not necessarily mean that you should do the same thing. 
And also, in some circumstances, paying off a mortgage may mean that you lose a tax deduction. Right? So people should not just assume, just because they have extra cash, that let's just pay off that. They should really consider talking to their wealth professional to see what is right for them. 
BILL NORTHEY: Yeah, so this is one of the things that I always appreciate in working with Amit and a number of our other financial planning professionals, is it always ties back to personal circumstances and understanding those personal circumstances, so incredibly important. What we've seen over the past many years, that real estate values have really escalated over the years. And one of the questions that's always on people's mind is should they take advantage of capturing that price appreciation and selling their home to make a profit? 
And there are a number of factors that homeowners need to consider, including the fees associated with it, the tax implications around the potential profits, if you're beyond the exemption from capital gains tax. And so what I'd like to do is maybe have Amit come back in here and give us some thoughts on, what are some of the areas that homeowners might contemplate if they have, indeed, made the decision to sell their homes? 
AMIT PODDAR: Thanks, Bill. So if you as a homeowner are considering a sale, or you've just recently sold your house, you're likely to pocket a healthy profit. The real estate prices have really risen up over the last few years, especially the last two years. So there would be a healthy profit for you. 
And there are plenty of choices what you can do with the proceeds. You can put it towards purchasing a new home. You can increase your savings, paying down debt, boosting your investment accounts, or buying a second home or a vacation home. And again, going back to the planning side, that Bill emphasized earlier, is deciding what to do with the proceeds again become a unique decisions specific to your situation and your family situation. 
So it's not a one size fits all solution at all. If you're considering taking that profit and putting it in something away from real estate or housing, take a step back, and take a look at your entire financial strategy, your goals, and your financial plan. What are your future goals and objectives? What are they now? Where are you headed? And what is your plan to get there? 
And how does this money that you have received now or you will receive when you sell your house, how does that help you get to your plan and to your goals? So that's where, again, work with your financial professional. Work with your wealth planner to come up with those solutions how that will help you, and take decisions accordingly and not necessarily as a rule of thumb. 
BILL NORTHEY: Yeah, very good insights there, appreciate that. And shameless plug, we do have an article that we have produced around home sale proceeds and investing the profit from a home sale. That is available both on our website, as well as in the Resources tab, that's directly in our webinar platform here. 
So we're going to go ahead and transition now to a set of questions really around cash and liquidity. And we'll bring Eric Freedman back in. So Eric, with inflation high-- and you've done a wonderful job of referencing this and giving us context around this-- how can I protect some of the cash savings that have been set aside? And what if I need those cash assets in the near term for something like an emergency? 
ERIC FREEDMAN: Yeah, I think it's a very relevant question, Bill. And I think a couple of things jump to mind. Number one, as you can see, and even to build on Amit's point from earlier, the whole concept of laddering various instruments within the short duration or the short maturity market makes sense. And so as you see interest rates rise-- and again, the Federal Reserve has been very, very transparent. In fact, viewers may have seen congressional testimony today from Federal Reserve Chair Jay Powell talking about their plans for future interest rate increases. 
So the good news, perhaps not during the journey, but ultimately, we will see higher interest rates. And that is beneficial for investors who are looking to, again, earn more in things like certificates of deposits and another short interest-bearing securities. So I would say, similar to Amit's point, don't change one's perspective about those needs. Make sure that your cash needs are certainly readily available. 
One thing that we do see at times, Bill, is that people will look to ladder some short-duration, fixed-income instruments and actually, realize that they've over-laddered. In other words, they haven't taken into account some of those shorter term, if you will, expenditures they may have. 
I'll give you a personal example. I've got one child who just graduated from college. I have another one in her sophomore year. And so I know that those bills will come due. There's no exemption, if you will, because of inflation or because of what may be happening in markets. Her university will be very swift, if you will, and timely with that remittance that I owe. 
So again, I'm thinking about this, as well, about OK, for capital that I know I have to spend in six months or in three months, is there anything I can do with that? And the answer is maybe in the very short term, no. But perhaps out 6, 12, 18 months, there's some things that I can do and again, use my US Bank contacts to help structure an appropriate level of liquidity to help meet some of those payments. So again, I think that using CDs to an advantage, but also, making sure that you are keeping in mind when those bills are due, very important tactic in the very near term. 
BILL NORTHEY: Yeah, thank you, Eric. And it's odd how the day comes full circle. We start by talking about kids and congressional testimony, and here we are again. So if you don't have-- Amit, I'd like to bring you back in here-- the opposite circumstance, if you don't have the cash on hand, and you need to pay down debt, or you have an unexpected opportunity or cash need, large purchase, what are some of the options that our audience might consider in that set of circumstances? 
AMIT PODDAR: Thanks, Bill. And that's a really good question. If you have the cash, then utilize it very well, as Eric has described. But if you don't, then what can you do? One of the options that you may have available to you is a liquid asset secured financing. And what it is, it just works just like a home equity line of credit, where in this case, the collateral is your investment portfolio instead of your home. 
So if you do have an investment portfolio, instead of liquidating it and realizing capital gains, or capital losses in some cases, you can just borrow against that investment portfolio. One thing that I'll add is a caution is your retirement accounts, your IRAs, 401(k)s, pension assets, are not eligible for collateralization. So if you find yourself in a scenario that Bill described earlier, where you need a short-term cash, or you have an opportunity to buy something, or you need to refinance your debt, this can be a good option. 
Some of the benefits for this type of line of credit include there is no origination or closing costs. It's a very streamlined application and expedited approval process. There are some attractive interest rates, even in this environment, that are available to us. And it's a flexibility around the repayment of principal that is available with it, too. 
In terms of some of the disadvantages, if you will, a couple of things to keep in mind are these lines, the financing lines, are tied to your investment accounts. So if you end up withdrawing from that investment account, or there is a significant drawdown on that investment account due to markets, then these lines will be impacted by those circumstances. So that would be one of the ways, Bill, that people can take advantage of these line of credits for liquidity. 
BILL NORTHEY: Yeah, thanks, Amit. And again, as we've mentioned numerous times along our journey here today, it all comes back to your specific situation. But one of our wealth management bankers can help you to assess that in the context of your wealth management team. And you can find one of those folks by using the Find an advisor or Banker link in the Resources tab, that's in the bottom of your webinar screen here. 
So as we've mentioned today, and I hope our audience is drawing from this experiences through the course of our conversation, is understanding your goals, your objectives, and how that relates to your specific situation is incredibly important. All of these decisions tie back to your financial plan. And there are many factors that can influence that for you as you think about growing and protecting and preserving your wealth and passing that along in the ways that are meaningful to you. 
So our planning process is really designed with that unique goals-based context in the way that we help to put that together collectively with you. Additionally, to help support the planning experience, this includes a number of different interactive capabilities, where you can create and collaborate together with your advisor. It gives you a tremendous amount of transparency and importantly, confidence in your plan and gives you a confidence meter. Am I reaching what I need to reach? 
And so you can see your real-time progress against your plan. You can see and test different circumstances and scenarios around how that might impact your financial plan on a go forward basis, if certain circumstances were to occur. So I'd really like to thank, as we are drawing to the end of our time here together, Amit and Eric for their meaningful contributions to our conversation today. I thought the insights shared were very important and timely. 
So as we conclude our time, let's take a look at some of the final resources that you have available to you to take advantage of as part of your relationship with US Bank Wealth Management. So next, if you're interested in a recap of today's conversation, if we move forward one slide, we'll be sending out a replay of the event soon after the conclusion of our time here together. And in the meantime, you can go to the Resources tab in the bottom right of your screen, and you'll see the ability to get to the latest market news and analysis that we provide as a part of US Bank Wealth Management. 
So one of the areas you can go to-- and if we can go to the next slide, please, Access our ongoing, up-to-date insights, there are two different particular websites that you can go to, first of which is usbank.com/wealt hmanagement/fina ncialperspectives. That is where you can get some of the thought leadership around financial planning topics. Additionally, Eric and our asset management group team who leads the work around our perspectives on markets and the economy, you can find all of the work that is done by that team at usbank.com/marketnews. 
And it appears we may have a couple of stuck slides here. So I'm going to see if I can advance that for us. But we should be on Scheduling a consultation. So if you're not a Wealth Management client, but you're interested in knowing how to apply the insights from today's conversation or just simply want a second opinion on what you might do with your own financial situation, you can look to a couple of different ways to contact us. 
And the first is a phone number, 844-233-5836. Or you can go to usbank.com/advisor, to find an advisor and banker near you. But perhaps the most convenient, and we hope you take advantage of this, is if you fill out the Contact Me tab in the bottom of your screen, we'll have a team member reach out to you proactively. 
So with that, we have, indeed, reached the end of our time here today. And want to thank all of our audience for being here. Eric, Amit, thank you so much for your time and expertise. We appreciate that. You've always been so generous in sharing your thoughts with our audience. 
And so with that, we will go ahead and close out our conversation today. Thank you so much to our audience. Have a great day, and be well.