Are We Having Fun Yet? How to Weather Stock Market Changes

Making money in the stock market is fun, right? Seeing your account balance climb, receiving an almost immediate reward on your 401k contributions, watching your net worth statement grow…it’s exciting!

What’s not fun? Stock market corrections. It’s especially not enjoyable when we’ve had recent periods in which we’ve had almost no volatility whatsoever (2017) and so we’ve forgotten that stock markets historically do two things on a fairly regular basis: they go up and they go down. That’s a rude awakening!

Here’s the hard truth

It’s almost impossible to have one without the other. It doesn’t work that way. You can’t have all candy and no vegetables. You can’t have all play and no work. And you can’t have all green days in the stock market with no red days.

But here’s what you can have:

  • You can have an investment plan for the long term that takes into consideration your unique tolerance for stock market volatility.
  • You can have a portfolio that you understand.
  • You can have a portfolio that you know will have good days and bad days, but that will get you where you need to go in the long term.

And here’s what you must control to win the long game: your mental mindset and your emotions. I am almost certain that you understand the hard truth about stock markets going up and down. As an investor in the stock market, fluctuations are a fact and something that should be anticipated. With that in mind, you should be in investments that work for you when the going gets tough.

In other words, you shouldn’t have screaming-down-the-runway-on-fire risk if you’re at risk of jumping out of your investments at the wrong time.

Corrections, and yes, the dreaded recessions, are a part of our economic reality. To be successful investors, we must accept risk, plan for it, be true to ourselves, and keep an eye on the long-term.

That’s the very definition of successful financial planning.

Have questions? We’re here to help. If the recent stock market changes have you wondering if your investments match your long-term goals, email us at wisdom@wisdomws.com.

 

 

Andrea Blackwelder Financial Planner

Andrea Blackwelder is a Certified Financial Planner ™ Practitioner, a CDFA® professional, and the co-founder of Wisdom Wealth Strategies, a fee-based financial planning and investment advisory practice. Andrea looks at your complex financial planning puzzle and assists you with the best options and financial strategies that align with your financial needs. To contact Andrea, email andrea.blackwelder@wisdomws.com.

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