Amidst EVERYTHING happening in the world, we have to deal with a stock market drop? Should we panic?
I’ve got to admit that it’s a little unsettling, watching all of the financial programs on Wednesday, October 15, while the Dow kept falling. Especially because it seems as if no one can agree on what’s happening next. Will it drop further? Is this a buying opportunity? SHOULD WE PANIC? Well, I’m here to tell you, panic is not your friend.
First, MY numbers.
Those are a tiny bit scary, right? No? Oh, that’s right, you’re missing the context. The context can be found in this post over here. The one where I tell you how to put $10,000 away in just 8 months.
OH, NOW YOU SHOULD BE SCARED!
But I’m not.
First of all, the advice in that post still stands tall. You CAN put money away into your retirement accounts, and you can maximize by being smart and taking advantage of everything you can. (Here’s a refresher at this post on 10 Financial Tips.)
Remember this point: these are retirement accounts. We are thinking long-term – not today, not even next year.
While not advocating a “set it and forget it” strategy, we also cannot give in to thinking that the sky is falling.
AND, we have to remember this point, which is actually a big one:
Your 401(k) is just PART of an overall financial puzzle. If that’s it, you need to do some soul-searching.
Panic Is Not Your Friend…
Here’s where we advise that you go see a professional. Do you have a Roth IRA? A Traditional IRA? Do you have pensions – you remember those, right? It’s possible you worked somewhere and became vested and – GASP – forgot about it. (It does happen.) If you have a spouse, are they maximizing their retirement savings?
What about savings that are outside of the retirement world – things that are liquid and even not-so-liquid?
But You’re Down 5%!
Or am I up $9,233.23?
There’s a takeaway to this rambling – and it’s the sort of thing we’ve been talking about pretty much all year here. You need to look at the total picture – earnings, savings, investing and SMART spending.
Market timing – playing the horses based on who is hot and who is not – isn’t the way to go here. Instead, we suggest taking a deep breath, charting and tracking everything, and making smart moves…a bit at a time.
After all, it’s not “10KaMonth.” It’s “10KaYear.” Remember that.