If you're like most people, you may be afraid to open the newspaper or listen to the radio. It seems like the negative news just never stops. The markets are seeing volatility that they haven't seen in a long time. Trump keeps tweeting and terrorism and guns are becoming the norm instead of a shocking insulated event. So what are you to do?
The message is not sexy, and it won't sell newspapers but it hasn't changed. Markets will be volatile and this provides an opportunity to buy things on sale. A lot of the mutual fund managers, have built up some cash so they are benefiting from lower prices are what we call buying opportunities. You also have cash in your emergency funds and as long as you aren't in retirement, you should be continuing to save. As long as you don't need your money right now, market volatility doesn't have much of an impact on you. Just like with real estate, the only time the price actually matters is when you are selling. This is why we try to have emergency funds / guarantees so that we have other places to access money when the market is down.
I know it's easy to forget, but try to keep in mind the analogy of someone playing with a yo-yo as they go up the stairs. Even though the yo-yo dips at different points, over the long term, the yo-yo will make it up to the top of the stairs. This is very similar to how short-term volatility is usually replaced with long-term growth in the markets.
Better still, let's focus on what we can control. Our spending, our savings and our directives. We are increasing our attention to your spending and saving, so if you haven't had an opportunity to have a discussion around these topics, it's something we will be addressing.
Also, as we approach the end of the year, this is a great time to make sure that your affairs are in order. Have you given consent for us to speak to your partner, spouse, child etc. in case you are not able to talk to us about your account. This is a new section that is been added to the know your client form.
Also, do you have your power of attorney for health and finance and is your will up to date?
Have you got one of our emergency contact cards to keep in your wallet? If not let us know and we'll make sure you get one.
This is a great time to think of your kids, grandkids and nieces and nephews. After they have reached the age of 16, you should get them to complete a power of attorney for health and finance. With all the privacy legislation that is now in effect, because these children are now considered young adults, if something happens to them, even as their parent, you may need a power of attorney in order to be able to help out. Best to take care of it now, while they can sign the forms and avoid any potential issues.
Remember, by focusing on what we can control, we can improve our outcomes.
Author: Julie Kranitz-Andrade
Date: October 2018