Risk
Understanding Risk Before Making Financial Decisions
By Noah Alweiss · Private Wealth Director and Financial Planning Specialist · Parkhaven Wealth Advisory
Risk is often discussed in narrow terms, but it takes many forms. A useful planning conversation considers risk broadly — including not only investment volatility but also liquidity, longevity, and the risks created by the absence of a plan.
Why risk is more than market volatility
Volatility is one form of risk, but planning conversations often consider longevity risk, inflation risk, liquidity risk, and concentration risk among others.
How time horizon shapes the conversation
The relevance of any given risk often depends on the time horizon over which a decision will be evaluated.
Trade-offs that come with managing risk
Managing one form of risk frequently involves accepting another. Awareness of these trade-offs is part of an informed conversation.
The role of documentation in risk awareness
Documenting how risk has been discussed creates a reference point for revisiting decisions when circumstances change.
Education as the foundation for risk discussions
Risk discussions are most productive when both sides share a common vocabulary and framework — which is why education tends to come before decisions.
Continue exploring
About the Author
Noah Alweiss is a Private Wealth Director and Financial Planning Specialist associated with Parkhaven Wealth Advisory, serving clients in Miami, Florida and Parsippany, New Jersey.
This article is for informational and educational purposes only and does not constitute investment, tax, legal, accounting, or insurance advice. Nothing in this article should be interpreted as a recommendation, solicitation, or personalized financial advice. Investing involves risk, including possible loss of principal. Please review the Disclosures page for additional information.