More vs Enough: The Debate

Greetings from Solana Beach,

Two weeks into 2026, several themes are emerging that appear favorable. U.S.-based companies continue to post consistent earnings growth, while AI tools are improving operating efficiency across industries. Despite jarring, ongoing geopolitical headlines, the broader economic trajectory remains intact, reinforcing the importance of disciplined portfolio construction rather than reactive decisions.

The DLK team is hard at work making sure our clients are well-positioned to benefit from the changes in the new tax laws passed last year, and we are always looking to have the “more vs enough” discussion when it comes to taking risks with hot stocks that seem to grab all the financial headlines.

Talk to Your CPA

One of our largest partners, Charles Schwab, recently posted a very extensive review of the tax code changes now in effect. You can read the full article here, and we recommend maybe even printing it out as a primer for your next conversation with your CPA.

Here are the highlights:

• Some Mortgage Interest Deductions have been restored.
• Estate Tax Exemptions have been expanded or reinstated under recent legislation, and increases will be tied to inflation.
• The Alternative Minimum Tax (AMT) is expected to impact fewer citizens.
• 529 Plans have expanded distribution amounts and increased qualifying expenses.
• Younger taxpayers have expanded savings mechanisms and less taxes on tips and overtime.

If you have any questions about how this might impact you or a family member, please reach out to us. We also introduce people to CPAs and estate planning attorneys every month, as it seems more and more of these service providers are retiring.

More vs Enough

DLK serves many different types of clients, but like most RIAs, a huge segment of our client base is families within five years of retirement or already enjoying the fruits of their labor. One of the key themes to understand at this stage of life is that the pursuit of more can often lead to much less when it comes to stock valuations and prices.

Household company names can appear safe because they are big and profitable, but the trap is that when they get too expensive, they can fall in price and take years to recover, just when the investor needs to pull out money to pay living expenses.

Two time periods are worth noting as we head into 2026 with many of the largest technology companies spending billions on capital expenditures with an eye on future profits, but not a guarantee.

The 2022 to 2024 turnaround:

These companies all lost more than 35% of their value and recovered it within two years. It just happened, so many of us remember it vividly as the post-COVID bond and stock markets were quite the roller coaster. Still, most retirees could have found a way not to sell these companies at their nadirs, most likely with an advisor’s help.

The 2001 to 2020, a lost generation:

Led by Cisco, these companies were down for so long that an investor who over-allocated to them while in retirement would have had a much more difficult time not selling at the bottom and losing real assets at the wrong time, all while not having the productive years ahead to replenish their nest eggs.

The siren song of more is fed by the media, our friends, and the fear of missing out. We counsel that “with age and experience comes wisdom” and the understanding that you are seeking to have “enough” of the right investments and you are able to live with “enough.” “Enough” is much better than “much less.”

We help our clients achieve enough through interactive dialogue and caps on how much of any one investment can be in our portfolios. We are also seeking quality companies at quality prices to keep the mean reversion premium in check and ensure that our clients have enough to meet their cash flow needs.

All investing starts with financial planning and a clear understanding of personal timelines and risk tolerances. If at any time you or a friend would like to meet and discuss how your risk profile or perspectives may be changing, please let us know, and we will set up a time to listen and advise where appropriate.

Markets and personal circumstances evolve, and our role is to help ensure your
portfolio evolves with them, deliberately and thoughtfully.

This material is provided courtesy of DLK Investment Management, LLC and contains general information to help you understand basic financial planning strategies. Throughout the presentation, we may generally discuss different financial vehicles; however, nothing said should be construed as a recommendation to buy or sell any security or financial vehicle, nor should it be used to make decisions today about your investments.

Our goal with this presentation is to expose you to ideas and financial vehicles that may help you work towards your financial goals. Please understand that we cannot make any promises or guarantees that you will accomplish such goals. All investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Any references to protection benefits or lifetime income generally refer to fixed insurance products, never securities or investment products. Insurance and annuity product guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.

This presentation is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market or recommend any tax plan or arrangement. Please note that DLK Investment Management does not give legal or tax advice. You are encouraged to consult your tax advisor or attorney.

Any hypothetical examples are for illustration purposes only and is not intended to be representative of actual results or any specific investment, which will fluctuate in value. The determinations made by this example are not guarantees or projections, and no taxes or fees/expenses are included in the calculations which would reduce the figures shown. Please keep in mind that it is possible to lose money by investing and actual results will vary.