CLEARWATER WEALTH PARTNERS
Client Meeting Transcript
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CLIENT: Chen Household (Sam & Alex Chen)
DATE: March 18, 2020
TIME: 10:00 AM
MEETING: 2020 Q1 — Emergency Review (COVID-19)
LOCATION: Video Conference
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TRANSCRIPT
[0:00] Sarah Chen: Thank you both for getting on the call quickly. I wanted to reach
out directly rather than have you sitting with your statements wondering what to do.
Markets have fallen sharply — the S&P is down about 27% from the February peak. Your
portfolio was at approximately $785,000 in mid-February; today it's around $610,000.
I know that's a hard number to look at. I want to talk through what I'm doing and
what I'm not doing.
[0:04] Sam Chen: Should we move to cash? My sister moved everything to cash last
week and she's saying she's glad she did.
[0:05] Sarah Chen: I hear that. And your sister might feel vindicated today. But
here's the hard truth: she still has to decide when to get back in. Every major
crisis — 2008, 2001, 1987, 1973 — the market recovered, and the people who moved to
cash locked in losses and then missed the rebound. The S&P's 10 best days of any
decade often come within a few weeks of its worst. Missing those days destroys
long-term wealth permanently.
[0:09] Alex Chen: So your recommendation is to do nothing?
[0:10] Sarah Chen: Not nothing — deliberate patience. Let me tell you what I'm
actively monitoring. First, your allocation. You're at 70/28/2 per IPS-2016. The
equity drop means you've drifted toward 65/33/2 — closer to the lower band.
Mechanically, that means we could buy equities at these prices — but I'm not ready to
recommend that today with so much uncertainty.
[0:12] Sam Chen: That feels like buying into a house fire.
[0:13] Sarah Chen: I understand. The other thing I want to flag: your ACCT-CASH is at
$91,000. That is real financial runway. Even in a worst-case income scenario — job
loss, extended disruption — you have months of cushion. The investment portfolio is
not your short-term income. That separation is critically important right now.
[0:16] Alex Chen: We both have stable jobs. NLTK is fully remote and we're still
operating normally. Sam's employer is also stable.
[0:17] Sarah Chen: That's the key fact. If your income is stable and your emergency
fund is intact, the right posture is to hold. The portfolio is doing exactly what a

long-term portfolio is supposed to do — it looks terrible in a crisis and it
recovers. The time horizon matters more than the current value.
[0:19] Sam Chen: I'll be honest — the 70% equity allocation feels more aggressive
to me right now than it did when we wrote the plan.
[0:21] Sarah Chen: That's important feedback and I take it seriously. I'm going to
send you both a risk tolerance reassessment questionnaire before our June meeting.
Not to react to prices — that would be the wrong reason to change allocation. But if
COVID has genuinely changed how you think about risk in a sustained way, that's a
real reason to recalibrate, and I want to capture that properly before we do
anything.
[0:23] Alex Chen: That makes sense. The questionnaire might be useful to do
together.
[0:24] Sarah Chen: I'll send it to both of you. Do it separately, then compare — it's
illuminating. On the NLTK vest coming in June: the vest happens on schedule
regardless of price. If NLTK has fallen significantly, the taxable income is lower
and the shares you hold will have a lower cost basis. That's actually a tax
efficiency — if NLTK recovers, the gain is larger but the tax on that growth is at
capital gains rates, not ordinary income.
[0:27] Alex Chen: So a low vest price isn't purely bad.
[0:28] Sarah Chen: Not purely. There's a silver lining in the basis. Action items for
today: I'm not making any trades. I'll send you the risk questionnaire by April 15th.
Do not deploy ACCT-CASH into the market regardless of the temptation — that money is
the home purchase fund and emergency reserve. I'll monitor allocations and rebalance
if we breach the lower equity band. Let's talk again in June when we have more
clarity.
[0:30] Meeting adjourned
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ACTION ITEMS
1. Send risk tolerance reassessment questionnaire to both Chens — by April 15
2. No portfolio trades — hold current allocation; monitor for IPS band breach
3. ACCT-CASH maintained at $91K — do not deploy to market under any circumstances
4. Prepare NLTK Q2 vest analysis given lower anticipated vest price
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CONFIDENTIAL — For client use only. Not for distribution.
