Keep Calm and Trust The Process
If you are ten or more years away from retirement and find yourself consumed with thoughts of the market’s volatility, this is for you. As someone who has not only lived through, but also remained invested during the entirety of the most notorious market crashes over the last three decades, I’d like to offer you a different perspective in the hopes of alleviating some of the stress you’re likely feeling.
From the time we learn what the stock market is and how it works, the biggest takeaway we have is up = good, and down = bad. While this can be true in the most general of senses, the market is truly much more complex, which is why, in times like these, I’d like to suggest a more diverse approach to your thought process about your investments.
Rather than focusing on every dollar and cent that fluctuates throughout each day, I’d like you to take a minute and pivot your energies on the following truths:
First, concentrate on the importance of your job. The heart of the matter is you need CASH now to keep your roof over your head and food on the table. You’ve got at least a decade before you need to even consider how and when to use your investments, and historically speaking, most market values after a bear market begin to grow within two years; so, let them continue to work for you, even when it’s scary. If you can help it, stop checking your invested accounts on a daily basis as doing so is only fueling the hope to control an uncontrollable outcome. Instead, continue to rack up your emergency fund with a goal of saving six to twelve months of expenses, and adding an additional 5% each year to account for inflation.
Second, and this is a big one you likely won’t exactly want to hear, take responsibility for your lifestyle. Inflation is real and prices are climbing quickly, so now is the time to be smart with the money you DO have in hand.
Rather than travelling abroad, vacation locally, maybe even with family and friends to lower the per person cost.
Instead of eating out, shop from your local farmers and butchers to create meals at home, and make it a goal to support your local restaurants once or twice a month rather than more frequently.
Evaluate your technology use, and whether having the newest big release is a true necessity.
Take inventory of your budget and control costs where feasible.
Third, and I can’t emphasize this enough, maintain your investment strategy. Work with your financial professional to keep them in the loop about your goals, finances, any major life changes, and your concerns. Then, as tough as it may feel, TRUST THE PROCESS and let us do the hard work FOR you.
Finally, cultivate community and friendship. I know, you’re probably wondering what this has to do with money and honestly the answer is nothing. What it DOES mean is focusing on your physical and mental wellbeing, which is equally important, not only in the good times, but also when the world feels like one giant tornado. You’ve undoubtedly heard the saying “it takes a village” and while this saying is typically used in respect to raising children, it holds true for all of us, regardless of whether we’re a household of one or twenty. Get to know your neighbors, take daily or weekly walks at the park with your friends, keep in touch with family members who don’t live locally, support each other and lend a helping hand, have potluck dinner gatherings. You get the picture.
I’ve said it a hundred times and I’ll keep saying it: we’re all in this together. Some days, the outlook seems incredibly bleak. I’d be lying if I said I didn’t feel it too at times. But I’m here to tell you, it gets better. I can’t predict the future, but I am living proof that we can come out on the other side of even the darkest market times. Keep the faith and control what you can. We will get through this, side by side and hand in hand.