By Dave Coen
Are the media headlines giving you financial whiplash? It seems like one day the sky is falling and the next it’s a utopia. It’s enough to give anyone a major migraine.
How do you stay calm during all the back-and-forth? You’re in luck, because that’s exactly what we’ll talk about today. Here are 5 simple ways to remain calm when the media headlines tell you the opposite.
1. Tune Out Financial News
Although stock market volatility is completely necessary for long-term growth, the media makes every dip and swing seem like a crisis. If the headlines are keeping you up at night and causing you endless panic, protect your sanity by tuning out the noise.
Turn off the television, unsubscribe from the daily email updates, and uninstall the stock market apps from your phone. This may seem extreme, but you’ll never stop worrying about your portfolio if you stay tuned in to what the media says. It’s their job to make you panic.
2. Stop Checking Your Portfolio
Technology has given us the ability to keep constant tabs on our portfolios, but that doesn’t mean we should do it. If you’re checking your portfolio every day, stop. Instead, check it quarterly, bi-annually, or yearly.
If you’ve invested money that you won’t need for 10+ years, it shouldn’t matter what the market is doing today. Stick to your long-term plan and remember why you started investing in the first place.
3. Create A Game Plan
When you create your financial plan, it’s always a good idea to think through what you’ll do in certain situations. For example, how often will you rebalance your portfolio? What changes will you make to your asset allocation as you get older? Or, more importantly, what will you do when the stock market drops (which it inevitably will)? Think through these scenarios beforehand so you can remain calm when the time comes.
4. Rebalance Once Everything Has Calmed Down
The key to a successful portfolio is diversification. If the stock market experiences a volatile period, your asset allocation may be slightly off-target. Once things have settled down–and you’re no longer acting on emotion–rebalance your portfolio to bring it back to its original asset allocation. This should be all you need to do to keep your investments on track.
5. Work With A Financial Advisor
Individuals who use a financial advisor typically see 3% higher returns than their peers. (1) This may not seem like much, but it results in sizeable growth over time. For example, if you contributed $8,000 annually for 30 years earning 10% versus 7%, you’d retire with $1.4 million instead of $808,584–nearly $600,000 more dollars! (2)
Financial advisors help you grow more wealth over time because they keep you from making irrational, emotional decisions with your money. Plus, they offer sound financial guidance that helps you reach your long-term goals.
How We Help
Staying calm when the media takes you on an emotional roller coaster can be challenging. The key is to focus on your long-term plan and ignore the noise. At SageView Advisory and College Planning America, we specialize in guiding parents through the complex college planning process. If you’re wondering how you’ll manage to retire with the lifestyle you want or how you will send your child to college without depleting your nest egg, we’re here to help you figure out the answer. Get started by emailing me at dcoen@sageviewadvisory.com or calling 800-814-8742.
About Dave
Dave Coen is a Financial Advisor with SageView Advisory and the CEO of College Planning America. Along with his retirement financial industry experience, he is a College Planning Specialist. He works closely with individuals and families to provide comprehensive financial planning that addresses all elements of their financial picture. Learn more by connecting with Dave on LinkedIn.
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Registered Representative with Cetera Advisor Networks LLC, doing insurance business in CA as CFGAN insurance agency LLC Member FINRA/SIPC Advisory services offered through SageView advisory group, LLC. Cetera is under separate ownership from any other named entity. CA insurance license #0G82578
This material is designed to provide accurate and authoritative information on the subjects covered. It is not however intended to provide specific legal, tax, or other professional advice. For specific personal assistance, the services of an appropriate professional should be sought. A diversified portfolio does not assure a profit or protect against loss in a declining market.
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(1) https://advisors.vanguard.com/iwe/pdf/FASQAAAB.pdf
(2) https://www.fool.com/retirement/2017/07/18/are-financial-advisors-worth-it.aspx
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