Investors prone to worry can find plenty to be fearful about during this third week in August. For Fed watchers it’s Jackson Hole, for Trumpsters it’s every day, and for many people it’s simply how long can the good times last? Fear is a real emotion that demands attention and understanding. It does NOT require drastic investment action. Here are 4 ways you can live with your investment fears…
Accept the fear and see what happens next
FDR was right, “the only thing we have to fear is fear itself.” Unexpected and unwanted things can and do happen, but fearing them only makes matters worse, and certainly doesn’t reduce the danger or solve the problem. FDR’s 1933 advice worked through the Depression and then World War II. We are in a much better position today. It’s okay to be briefly fearful, but one must move on.
Stop feeding the beast
An event grows in proportion to the attention paid to it. “Don’t trouble trouble ‘til trouble troubles you” is how my grandmother put it. She was always right on that one. By speaking with her and sharing my fears the emotion seemed to lose its power over me. Acknowledge the fear and then forget about it
Let the cash flow
As an investor, you can’t wish away the circumstances that may induce fear, but you can focus on more certain aspects of your portfolio. For instance, cash flow — interest and dividends — is a nice tonic when you are anxious, fearful, alarmed or just plain nervous. A solid 2.5 percent is de rigeur for portfolios here. A higher yield is available for the more preservation minded, a lower yield with higher growth is better for the longer term investor. No matter what type of investor you are you can get good cash flow today.
Talk to someone
Every bump in the night is twice as scary when you’re alone. Share your fears with someone who will listen without judgment — your investment advisor, your trustee, your co-investor in projects. Talking through your anxiety puts it in perspective and introduces new ways to think about it. Don’t go it alone. We’re available to discuss what’s on your mind.
Journey on with lots of conversations
Some asked me over the weekend how stressful my job was on a scale of one to five. Ten, I answered. You can accept your fear just as I accept the stress of my investment advisor job. We can both live with it, and expect good results.
John Osbon – firstname.lastname@example.org
You might enjoy reading this article on Scary Markets because it also discusses fear.
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