The upcoming election with strong feelings and opinions on both sides, and potential delay in results and increased uncertainty, could morph into a temporary crisis.
Remaining calm during any crisis not only helps us psychologically, but it can also help us financially.
Markets and Past Crises
Over the past 50 years, the markets have experienced several major crises. We had an oil embargo and high inflation in the 1970’s. Followed by the tech bubble burst and 9/11. We also dealt with a real estate crash, global financial crisis, global pandemic, and many bear markets.
When faced with crises, the natural instinct might be to sell. After all, the news is bad and forecasted outlook during crises is often poor. But history shows that, regardless of how good it may feel at the time, selling in any prior crises would have been a costly decision.
Despite all the crisis in the last 50 years, investors who remained calm and stayed invested earned an average of 10.8% per year.1
Remaining Calm Amid Crises
Ignoring the noise and focusing on your investment plan can help you remain calm in a time of crisis.
You can find calm in understanding what you own and how it is expected to perform in various markets. You can find calm by trusting that your plan will get you to your desired goals.
It is natural to get worried and anxious when outcomes are undesirable and/or uncertainty increases. That is what I am here for – if you find yourself becoming overly concerned, please let me know. We can talk about what is going on, potential outcomes, and ensure that your portfolio works for you, through calm and crisis.
– Jonathan
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. No strategy assures success or protects against loss.
1. S&P 500 with dividends reinvested from January 1973 – October 2024. Calculated at https://dqydj.com/sp-500-return-calculator/. The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. All indices are unmanaged and may not be invested into directly. Past performance is no guarantee of future results.