Things aren’t as simple as they used to be: Modern technology has brought many great things, but sometimes we can get overwhelmed by instant access to more information than we can handle. For better or worse, the investment world has become similarly complex and confusing. We are bombarded with advertisements for the ETF that will offer the returns of the S&P, with half the risk; or the once-in-a-lifetime opportunity to buy undervalued assets. On top of that, your friend asks why you work with a financial planner, when your portfolio returned only 5 percent last year, versus the S&P’s 13.7.

In this era of information overload, however, we should remember what’s at the heart of our decisions. We believe that our clients decide to invest because they envision that investing will help them achieve their financial dreams.

Still, to achieve any goal, you need a plan, and the only investment advisors worth a damn are those who make sure they completely understand what it is you want to accomplish.

Your friend may say, “I want to beat the S&P this year, so I’ll find an advisor who’ll tell me which asset class will do that.” While we’re sure your friend will find dozens of “advisors” with hot tips, we’d encourage you to advise that timing and selection will always be a fancier name for gambling. Beating the S&P is not a financial plan. The best financial planners admit that they don’t know what asset class will perform best this year.

What we also know is that a well diversified portfolio, continuously monitored by quality mutual fund managers, will give our clients the greatest chance to realize their financial dreams.

We also understand that even the most well-constructed financial plan can unravel, if we veer off course. Investing can be particularly confusing because it doesn’t work like many other things in life—and when we follow our instincts, we often wind up going in the wrong direction. When the market is performing poorly, it’s natural to want to get out. When things are looking great, it’s easy to become overconfident.

Last year, Morningstar added yet another report showing how investors’ behavior negatively impacted their performance. In the 10-yearperiod ending in December 2013, the average investor earned 4.8 percent annualized, while the average fund earned 7.3 percent. To put this in perspective, the difference on a $100,000 initial investment would have been $42,288 ($159,813 versus $202,301). So, consider: A good financial planner will always be there to remind you of and help you stay committed to your financial plan.

There have been eighteen bear markets since my father was born in 1934—one every 4.5 years on average.1 I can say with confidence that more will follow. When they do, it won’t be fun, but if you develop a comprehensive financial plan early on, revisit and update your plan yearly and commit to the planning process, your odds of weathering the storms dramatically improve.

1 “History of U.S. Bear & Bull Markets Since 1929,” http://www.gold-eagle.com/article/history-us-bear-bull-markets-1929, DrDoolittle, May 5, 2013

Kevin R. Luchetta offers advisory services as a representative of Northwestern Mutual Wealth Management Company (WMC), a limited purpose federal savings bank, and a wholly owned subsidiary of The Northwestern Mutual Life Insurance Company, Milwaukee, Wis., (NM). Northwestern Mutual is the fleet name for NM, its subsidiaries and affiliates. Investments held with or managed by WMC are not insured by the FDIC, are not deposits or other obligations of, or guaranteed by WMC or its affiliates and are subject to investment risks, including loss of the principal. Kevin R. Luchetta is an insurance agent of NM (life insurance, annuities and disability income insurance), and Northwestern Long Term Care Insurance Company, a subsidiary of NM, and a registered representative of Northwestern Mutual Investment Services, LLC (NMIS), an NM subsidiary, broker-dealer, investment advisor, member FINRA, SIPC. Pioneer Financial is a marketing name used by a group of Northwestern Mutual representatives (not all of whom are affiliated with WMC) including Luchetta (referred to as the “firm”), and is not a legal entity, partnership, investment advisor, broker-dealer or affiliate of NM. The information contained in this article is not a solicitation to purchase or sell investments or securities. The views expressed herein are those of the author and may not necessarily reflect the views of Northwestern Mutual. Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP ®, CERTIFIED FINANCIAL PLANNER and federally registered CFP (with flame logo), which it awards to individuals who successfully complete initial and ongoing certification requirements.

This article was originally published in the June/July 2015 issue of Worth.