It’s an emotional time for our country and people all across the globe. The Coronavirus (COVID-19) has taken us from 0-60 emotionally in an unprecedented short period of time.
Just a few short weeks ago we were enjoying a stable, growing economy and living life as usual. Fast-forward to now, we are learning that the government is lowering Fed rates, offering assistance to airlines and businesses along with imposing restrictions on how many people can gather in the same place.
Hearing this has caused unprecedented levels of uncertainty for markets and our communities. Emotions continue to run higher each day as we learn about school closures, sports season postponement, quarantines, and see pictures of empty grocery store shelves.
Even with all of the current uncertainty, we are reminded that this is not the first time we have navigated uncertain financial times. We have seen a few unsettling market events over the last 100 years that shook our country.
The 1929 Great Depression…1987 Black Monday…2000 Tech Bubble…2001 Terrorist Attack…2008 Financial Crisis…and in 2020 the COVID-19 Pandemic.
The greatest single lesson I have learned as a consultant and entrepreneur from these events over the last 27 years is that these events have all proven to be temporary and our country has experienced growth following all of these events.
So, while these events are to be taken seriously and require our attention, we have to think beyond what is happening and focus on the future.
What does that look like in the midst of a pandemic and media frenzy? Focus on what you have control over.
- Protecting your health… be diligent with hygiene and follow government officials recommendations.
- Protecting your family…caution on the side of health and safety when making decisions.
- Protecting your cash flow…keep cash on hand (literally) and limit unnecessary spending.
- Protecting your money…now is not the time to panic sell your investments. Continue to save and invest for your future.
- Protecting your future…it is a perfect time to reevaluate the strategy being used to build your future wealth.
It is prudent to mentally prepare for a few things and protect your thoughts from running negative.
- Markets are going to remain unsettled for a while as traders take advantage of the roller coaster with very active trading.
- It is possible to hear about recession concerns resulting from this pandemic even though the markets and economy were solid before the virus spread across the world.
- We would be foolish to believe that our country’s politicians aren’t going to take advantage and use this as an opportunity to play the blame game. We need to be prepared for A LOT of rhetoric from Washington once things settle down. As Rahm Emanuel once said, “Never Let a Serious Crisis Go to Waste.”
For those who can stay strong mentally and play the long game of wealth creation, there is tremendous opportunity ahead.
Reestablish Your Financial Beliefs:
It is times like these that people begin to question their risk tolerance for the markets. While now is not the time to be acting on this epiphany, it is worth taking time to develop a revised strategy for how you want to manage money in the future.
I have always taken a strong position that the markets don’t always go up and have shared with you that they have actually produced significantly less return than what most people believe.
If you desire a solution that will move more things into your control, now is the time to begin this discussion. Our team is working virtually to help guide this discussion. You can schedule your discussion here.
When your financial education goes up so does your degree of control. When your degree of control regarding financial assets goes up, your risk goes down.
Billionaire Ray Dalio has been actively sharing his thoughts on what is happening…
“Logic, reason, and common sense are your best tools for synthesizing reality and understanding what to do about it. Be wary of anything else.”
“Psychological studies show that the majority of people follow lower-level paths most of the time, which leads to inferior decisions without their realizing it.”
“It is more important that decision making be evidence-based and logical when groups of people are working together. If it’s not, the process will inevitably be dominated by the most powerful rather than the most insightful participants, which is not only unfair but suboptimal. Successful organizations have cultures in which evidence-based decision making is the norm rather than the exception.”
You only know and understand what you are aware of. If you think you know everything then you are doomed to experience failure and setbacks.
“Most people make bad decisions because they are so certain that they’re right that they don’t allow themselves to see the better alternatives that exist. Radically open-minded people know that coming up with the right questions and asking other smart people what they think is as important as having all the answers.” – Ray Dalio
Conclusion: Expand your thinking and get help to focus on what you can control.
If you are a client, we will be here by phone, email, or video conference to answer any questions or offer support.
For those of you who may not be a client, our online courses, podcasts, blog, and other informational content will be available and updated for you to keep learning and growing.
To Your Financial and Physical Health,