This is the fastest initial decline in the stock market than at any time in history.
Although I thought we were heading for a bear market, I would never have thought I would write those words above. Yet, here we are. I don't even think that what has occurred has hit home as of yet. This decline only started 34 days ago. Regardless, there is the nagging feeling that you should be doing something. How do you know if you need to be making changes or not? What if you decide to make a change and make the wrong decision?
Pop Culture Finance tells you that you are a long-term investor, and it would be a mistake to make any changes. The reality is that we are all long-term investors. They also tell you not to make emotional decisions. That I would agree with 100%, so make your decisions based on anything other than emotion. I have said for a long time now the same thing over and over.
Make sure that you know the amount of risk you are taking and that you are comfortable with it. There are two components to taking the risk.
First, risk and the relationship to your Goals.
This should all be about your risk level and its' relationship to your goals. Here is how it works - Your risk level is a crucial component to your goals. Your financial goals are driven by 1 of 3 variables - savings, risk/rate of growth, and time. There is only so much time, and there is only so much money that you can save. The only part of the equation that you can increase or decrease is the risk level of your investments. Maybe you need to rethink your financial goals because you are not comfortable with the risk that are you taking? Do you even know your financial goals?
Second, risk and the way that you are investing.
How are you taking the risk? Are you riding the roller coaster, or do you have a strategy? Do you have someone actively managing your money for risk, or are you being told to hang on and not look? It may not necessarily be the risk you are taking. It might be the way you are investing that you are not comfortable with.
These are decisions that you need to be focusing on. There are strategies for your 401 k plan as well as strategies for your IRA that you can use to smooth out the ride of the roller coaster. From risk surveys to actual money management, I can help navigate you through this decision making process by doing everything in an online setting. There is never a cost for the process. If you want more information, send me an email at firstname.lastname@example.org or call us at 972-386-0384.