To say the last four months have been interesting would be an understatement!
We have seen the longest government shutdown in history, the Dow reached an all time high, then fell into correction territory, then bounced back. We’ve had concerns over global economic growth slowing, we’ve seen record low unemployment, and on and on! How does all this affect your goals?
Take a step back and it reinforces some very important personal financial principles:
1. Focus on the long term not the short term! If you would have panicked in last December and sold everything, you would have potentially missed a 10% bounce in the weeks that followed. Thus damaging your long term goals and how your savings play a role in that.
2. Never take more risk than necessary to pursue your goals! Over the last 8 years, the markets have treated us well. But if your risk allocations were higher than they should have been given your life goals, the recent months could have taken you out of your comfort zone and could cause you to question the process.
3. Don’t be so focused on returns! Returns are relative! Mark Twain said, “There are three kinds of lies: lies, damned lies, and statistics.” Anyone can take a particular investment, show it to someone in a specific period of time and make it look great! Returns should be thought of as an average over a long period that is simply a mechanism to used in pursuit of achieving your goals.
4. Work with someone you trust! Work with a Financial Planner who you trust and you know has your best interest in mind. Working with someone who is focused on selling you a product or doesn’t discuss Big Picture planning could jeopardize your future goals. You wouldn’t go to the cashier at CVS and ask about blood work, would you???
FOCUS ON LONG TERM GOALS
Times like these can seem painful and worrisome. They cause us to step back and re-evaluate our processes and make sure we are all doing what we should be doing – Focusing on Long Term Goals while ENJOYING our lives TODAY!
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is not a guarantee of future results. All indices are unmanaged and may not be invested into directly. The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries and widely held by individuals and institutional investors.