In this episode Jason and Alex revisit the concept of stress, especially as it pertains to investing. At times like these that test our emotions, it is more important than ever to focus on the things that we can control and accept what we can. It’s also easy to get caught up in the massive amount of information that is everywhere regarding COVID – 19. We are all trying to become experts as quickly as possible, but the truth is that very few of us are qualified sources for this type of information meant to be giving advice to others. The same can be true of those who give investment advice. One of the most stressful things an investor face is being invested at times when markets are dropping. It feels like you are out of control and that you are losing hard earned and saved money. This feeling motivates some to sell out of fear. Then the fear of losing ends and a new, much scarier fear replaces the old fear. The fear of not being invested when the markets recover and skyrocket to new and higher levels than ever before. Investors know that they face this emotional test and know that being invested means a greater chance of accomplishing their financial goals. The actions that we take are ours to control as are the emotions that come along with them. Jason and Alex talk about things that you can do if you did sell and go to cash or move to all bonds when that wasn’t part of your investment strategy prior to the recent drop. They also explore the concept of using annuities and other alternative asset classes to further diversify a portfolio. Some common messages resurface in this episode. You need to have a financial plan that takes all factors into consideration. Your investment strategy should be determined by this plan and when emotions run high the best thing you can do is go back and reference your plan.
In this show you will learn about:
– The stress associated with being invested compared with the stress of not being invested, especially during extreme market events like COVID-19
– Things that you can do now if you did sell at, or near, the most recent market bottom
– How to use an evidenced based investment philosophy to support adding an alternative investment to your portfolio