Rebalancing Your Investments

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Hey Coach,

Great coaches don’t let their team drift away from the game plan.
And great investors don’t let their portfolio drift away from the strategy.

That’s exactly what rebalancing is - bringing things back to the plan when life, markets, and emotions pull them off course.

Let’s break it down so you know exactly what to do.

Why Rebalancing Matters

Your portfolio is like your team’s lineup.

You choose the starters for a reason:

• Some players score (stocks)

• Some players defend (bonds)

• Some players slow the game down (cash)

But as the season goes on, those roles can drift.
Stocks may grow too fast. Bonds may lag. Cash may pile up.

Before you know it, your “balanced” lineup becomes a “run-and-gun” team without the defense to back it up.

Rebalancing resets it.

What Causes Your Portfolio to Drift?

Just normal life and normal markets:

• Big stock market run-ups → suddenly you're riskier than you planned.

• Market drops → suddenly you’re too conservative.

• Life changes → closer to retirement, higher/lower income, new goals.

• Automatic contributions → money piling up in one account more than others.

The drift happens automatically.
Rebalancing is the intentional correction.

When Should You Rebalance? (2 Simple Options)

There are two strategies - pick one and stick to it.

1️. Rebalance on a Schedule (Most Common)

Choose a frequency and treat it like a coaching meeting:

• Every year

• Every 6 months

• Every quarter

Pros:
✔️ Simple
✔️ Predictable
✔️ Emotion-free

Cons:
❌ You may miss extreme market swings

Best for most coaches.

2️. Rebalance Based on Drift Thresholds

Rebalance when your portfolio moves out of bounds - usually by 5–10% away from your target.

Example:

• Your target is 70% stocks / 30% bonds

• After a big rally, you're at 80% stocks / 20% bonds → time to rebalance

Pros:
✔️ More precise
✔️ Reacts to big changes

Cons:
❌ Requires monitoring
❌ Slightly more complex

Best for detail-oriented investors.

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How Do You Actually Rebalance? (Simple Steps)

It feels more complicated than it is. Here’s the play-by-play:

Step 1 - Review Your Target Allocation

Example targets:

• Aggressive (younger coaches): 80% stocks / 20% bonds

• Balanced: 60% stocks / 40% bonds

• Conservative (approaching retirement): 40% stocks / 60% bonds

This is your “game plan.”

Step 2 - Compare to Your Current Allocation

Look at your accounts:
➡️ 403(b), 401(k), IRA, brokerage

Your investing platform usually shows a pie chart - what percent is in stocks, bonds, cash, etc.

Step 3 - Make the Adjustments

You can rebalance by:

Option A - Selling what’s too high and buying what’s too low

Example: If stocks have grown too much, you sell some and buy bonds.

Option B - Using new contributions to rebalance

A quieter, tax-friendly approach for taxable accounts.

Option C - Adjusting future contributions

Shift future investments toward the underweighted side.

The Behavioral Edge: Why Rebalancing Keeps You Disciplined

Rebalancing forces you to do what most people avoid:

• Sell high (emotion says “don’t sell winners!”)

• Buy low (emotion says “don’t buy losers!”)

This is pure discipline -
the same mental toughness you teach your players.

Rebalancing Frequency Guide for Coaches

You don’t need weekly monitoring.
Just enough to stay aligned.

Final Whistle: Keep the Game Plan Intact

Rebalancing is about staying in control - not reacting to headlines or emotions.

Your long-term success comes from consistency, not prediction.

Here’s your simple roadmap:

💡 Set your target allocation
💡 Review it once or twice a year
💡 Make small adjustments
💡 Stay disciplined

Just like on the court, sticking to the system wins more often than chasing momentum.

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Coach Mike Klinzing
Founder, Wealth4Coaches
"Coach smarter. Save better. Live freer."