I’ve Got A Secret For You!
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Howdy folks, I’m going to keep it short and light for you today. Unless you’ve been living under a rock the past week or so, the stock market has been going absolutely nutty. Not just nutty, but jacked. We had days where the market would be up at a nice clip, only to spiral downwards by the end of the day. We also had days where the stock market was down nearly 1,000 points.
It’s easy to see the craziness and expect a return of 2007-2008. I spoke to thousands of investors during that time, and after. They were seeing their portfolios go down the dumps and they sold everything out of fear. They locked in their losses, sat on the sidelines and missed out on the following run-up. If you are tempted to do the same thing today I have a secret for you.
Are you ready? Don’t say I didn’t warn you. Here it goes…
It’s going to be ok!
I know what you’re thinking. But, but, China is having problems.
The Fed can’t decide when they will raise rates
The price of oil has certainly plummeted too much
Blah, blah, blah
Listen, I don’t know what the market is going to do. Anyone who tells you they know what will happen should summarily be ignored. What I can tell you is the above fears are white noise blared at you by talking heads who don’t know what is going to happen tomorrow.
You know what? None of them – be it Yahoo Finance, CNBC, Jim Cramer (who needs to be muzzled by the way), CNN, etc. have any clue as to what your situation is and what you should do with your portfolio.
You know what they do know? That we are emotional creatures and they need ratings. I’ll let you put the two together.
While this is a great time to assess your risk tolerance, attempt to quantify any potential opportunities in the market and understand your investments, it is not a time to act out of fear.
In reality, this is a time to do very little. It’s time to keep your head down and continue to work towards your goals. It’s time to turn off the TV and focus on what you want – not the fear they want to stoke in you. It’s time to plan out what you want to throw on the grill for your Labor Day BBQ!
That’s it. The secret is there really is no secret! 🙂 If you want more in-depth, ‘how to’ posts on investing in the stock market, feel free to check out some of these:
- How to Invest in the Stock Market with Little Money
- 6 Best Investing Books for Beginners
- 5 Investing Mistakes That are Easy to Make
- How to Invest in Stocks When You Don’t Know Where to Start
What’s your reaction to the recent volatility in the market? Were you able to take advantage of any opportunities? What’s your plan for Labor Day?
John is the founder of Frugal Rules, a dad, husband and veteran of the financial services industry whose writing has been featured in Forbes, CNBC, Yahoo Finance and more.
Passionate about helping people learn from his mistakes, John shares financial tools and tips to help you enjoy the freedom that comes from living frugally. One of his favorite tools is Personal Capital , which he used to plan for retirement and keep track of his finances in less than 15 minutes each month.
Another one of John's passions is helping people save $80 per month by axing their expensive cable subscriptions and replacing them with more affordable ones, like Hulu with Live TV.