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Then there are the investors who follow the herd as the market is going up, investing in hot sectors on a whim, often taking on more risk than they might otherwise.
"It's not only being too aggressive, but not having a whole plan. When the market is going up, they take on too much risk for their investment profile. (Then) when the market pulls back their accounts, (they) see a decline and they go to cash without a plan on when to get back in," says Christopher Zeches, CFP professional and managing partner of Zeches Wealth Management in Phoenix and Tucson, Arizona. "Additionally, they allow white noise, such as the presidential election and Brexit, (to) influence their decisions and do not stick to a plan."
In a similar vein, there are savers who manage to sock away money, but never come up with an investing plan.
"While it's common to hear about employees having lost great sums in their company-sponsored plans, usually because they've been too aggressive or aren't properly diversified, what might be more alarming is the fact that people have left their retirement savings in money market accounts for years. This is clearly too conservative and usually has more to do with a lack of direction than aversion to risk," says Gregory Hermes, senior vice president and financial adviser at First Financial Equity Corp. in Scottsdale, Arizona.