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So the money keeps rolling in. Or not…

Preparing for the second half of Year 2020

By Mary Grace Musuneggi

“When the money keeps rolling in you don’t ask how”
                        – ”Evita” by Andrew Lloyd Webber

History teaches us that what goes up goes down.  What goes down goes up.  And when it comes to the stock market there are these two obvious truths.  It goes up.  In 1920 the Dow Jones Average hovered around 66.  Yes, that is the number:  66.  Today it has been hovering around 26,000.  Yes, that is 66 then to 26,000 now.  So, it goes up.

But to get to that “up” it has gone up and down and up and down and up and down over time.

For those who have held during downtimes, to wait for the uptimes, rewards await.  But for those who do not or cannot wait for the downs to go up, it is a scary and strange time.  Causing some to abandon their long-term strategies and jump out of the market.

Many financial planners compare this to a ride on a train.  When you ride over the hills and into the valleys, if you jump off, you end the trip abruptly and maybe dangerously.  You have not gone forward to the end of the trip.  Reminding clients to not jump off the train.

But more importantly, our belief is that for the short term, you may not want to be on the train at all.  But over the longer term years, you may want to take the ride on the train.

The most important thing is to have realistic expectations as to what your money can do for you.

Short term goals should be funded by short term investment.  Long term goals by long term investments.  Pretty simple stuff.  We call this “bucketing”.  No guarantees but a great strategy for dealing with short and long term events in the economy, the world, the markets and most importantly your own personal financial world.

To discuss your situation, contact us to schedule a call.