Be kind to yourself. As stock markets mirror the changing economics brought about by COVID-19, it is important for you to take some deep breaths, remember your financial goals and be kind to yourself. If you are anxious and nervous about your investments and savings, that is natural. Your portfolio was designed for you and although it might feel like a natural response to sell everything, that is an irrational response.
To help see things from a different perspective, if you compare your balance from 12/31/2018 to what it was on Friday, 3/13/2020 it’s not as great a loss as you think if you look at the long-term picture. Yes, 2019 was a stellar year for the stock market, which makes current losses seem sharp, but in the big picture, you’ve lost about one years’ worth of gains.
In order for you to take more control there are some financial “duties” that can be done.
Here is a list of things that you might consider:
- Educate yourself about your current investments
- Use an online retirement calculator to see if you need to make any adjustments
- Research and reach out to a local financial planner to advise you
- Ensure your emergency reserve has enough savings to get you through three months
- Start tracking your expenses to gain the knowledge on how much will be in your emergency reserve
- Develop a plan for your financial goals and revisit as needed to remind yourself on why you are invested
- Consider making a small adjustment to your portfolio (no more than 5 – 10% change) if you feel strongly that action is needed
- Confirm and update the beneficiaries on your investment and bank accounts
- Take online financial education classes to become a more informed financial consumer
We all know that selling in a down market is highly discouraged, after all the saying is “buy low, sell high.” Now is not the time to sell low.
It is the time to take some action around your finances while you are thinking about them and have some space to do so. Be kind to yourself and others around you.
Here at Financial Knowledge we support you in your quest to become more educated around finances and investments. We understand that this can be a tough time and are here to help you navigate these unsettling times.
Let us know what you are doing to take care of you and your finances and how we can be a partner on the journey.