It’s perfectly natural to be in a state of confusion today. The markets opened Monday and promptly dropped 7%, triggering the first trading halt of the day. The S&P 500 (and most major indices) is down nearly 18% from its all-time high recorded on Feb. 19. While we see an average, annual intra-year drop of 13.8%, we are not accustomed to it happening with such ferocity and pace.
But let me remind you: every investor, every business, every American is in the same boat right now. Concern is a valid response when the future is unknown. However, we’re on your side – being cautious, watching developments closely, and remaining level-headed as we focus on your long-term financial plan.
In any year and any economy, there will always be things we can’t control. Currently, the impact of the oil pricing war started by Russia and Saudi Arabia might hit close to home for many of us. Interest rates are at the lowest they’ve ever been. The uncertainty about the seriousness of COVID-19 and how it will impact the economy has most people feeling nervous. Although we’re facing much we don’t understand or can’t control at the moment, it’s always best to focus on what we can control.
It’s prudent that we continue functioning as long-term, goal-focused investors. Having a plan and staying the course is our top priority, and we should only make changes to portfolios when a financial plan changes. While most of your plans will remain the same, some external factors could prompt updates depending on your unique situation. Oil drives much of our economy in Oklahoma, so we must respect its impact – even more than a broad market drop. If it’s time to react, a well-measured reaction is paramount.
While we watch for the full breadth of these headwinds to be fully realized, there are a few things you can do:
Turn off the news when it shouts at you. If your browser is telling you bad news in ALL CAPS, it’s probably not helping your fear. Fear is a powerful motivator, but rarely in a positive way.
Wash your hands. COVID-19 may not be of great concern depending on your age, health conditions, or geography, but if we can all do something simple to avoid it, we should.
Call us when you’re panicked. We’re here for many reasons, but first and foremost, we exist to help you understand and achieve your goals. If there are things you’re concerned about, allow us to help.