Stay Focused

Stay Focused

In the spirit of Halloween, Mr. Market decided to wake up October 1st and scare the crap out of everyone. October has been one of the most volatile markets in years and a lot of investors are worried that Mr. Market might have turned into Michael Myers…

Michael Myers Halloween GIF

Source: Giphy

This month has been a series of neverending scary market headlines. And rightfully so, there is a lot of news coming out this month that is really driving investors to rethink if they should be investing or not. If we just look at the past two days, the point changes in the Dow Jones are really quite remarkable.

  • On Wednesday, the Dow Jones Industrial Average fell more than 600 points.
  • On Thursday, the Dow Jones Industrial Average climbed more than 400 points.

When it comes to volatility, we have to focus on why we are in the markets in the first place. There is a reason your checking and savings accounts pay virtually nothing. That reason is the fact that you are insured and taking virtually no risk.

The stock market pays you to take risk.

This is the entire reason why we invest. The S&P 500 has grown by 9.65% annually since 1928. The cost you have to pay to receive these returns is to stick with your investments through the inevitable volatility. How you manage your behavior and emotions is DIRECTLY responsible for how your investments will do. Image from iOS (1)

Now, I sympathize completely with the concerns about losing money. Every investor has a different goal they are saving for and that makes it hard to fully understand how the markets make each of us feel.

However, investors need to focus their attention on the right aspects of their investments and financial planning or they will truly never achieve their goals. Stressing over the individual DAYS in the market is a fool’s errand.

Things You Control - Carl Richards

Where You SHOULD Focus Your Time:

  1. Ensuring you have a proper asset allocation
  2. Making sure you are invested in tax-efficient accounts/products
  3. Maintaining a budget
  4. Regularly saving
  5. Reading more of Jack’s blog
  6. Focusing on your career
Please ignore typo’s, I will be editing grammar as I go!
Sources: Giphy
Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.

Markets Down 5 of 6 Days!

Motivational Quotes On Focus Focus Quotes (50 Wallpapers) - Quotefancy

I thought it would be a good idea to put a TV in my office to keep an eye on the financial markets, current events, and other topics that my clients might call about. But I am now finding myself creating more issues and concerns than anything else.

Today, for example, I had a client stop by for help organizing the finances of their son’s wedding. They are so excited that their first child is getting married and they wanted to make sure everything was perfect. We had been planning for this wedding for the past 5 years so it was a great opportunity to see their planning from start to finish.

Instead of discussing how to handle taxes for their distributions or updating our financial planning figures, we spent about an hour talking about Chinese debt levels, tariffs, and interest rates. Why you may ask? Because CNBC thought it was relevant to slap up a nice banner at the bottom of the screen.

Market Sell Off 10.24.18.PNG

Source: CNBC

I have written a lot about information overload and the amount nonsense that comes down the pipeline. Investors today are overwhelmed with way too much information that completely derails our thoughts about our own future. Instead of spending time working on the important aspects of our lives, we instead attempt to consume the firehose of information in front of us.

Peter Griffin Firehose GIF - PeterGriffin Firehose FamilyGuy GIFs

Source: Tenor

What we should be doing is working on the things that really matter. Making smart decisions to ensure your child’s wedding is perfect is WAY more important than what happens in the stock market on any given day. The same thing holds true whether the goal is saving, retirement, college, or anything else.

 “In the short run, the market is a voting machine but in the long run it is a weighing machine.” – Ben Graham

This quote is decades old but still holds true today. In the short term, the stock market is a popularity contest. Investors are hyper-emotional. We tend to get too excited about unsure investments and overly concerned about the scary news. But long-term patience with investing is the key to success. Allowing the markets to be irrational in the short-term for the reward of gains in the long-term is exactly why we are all here.

Focus - Carl Richards

Please ignore typo’s, I will be editing grammar as I go!
Sources: CNBC & Tenor
Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.