How to Stay Calm in a Volatile Market
Many of the calls and emails I’m getting these days are around how to deal with the volatility of the market. No one has the answer but I seem to make my clients feel better and how to handle the risk! in the meantime - check out my upcoming workshop on September 24: The Woman’s Compass Workshop: Guiding You Through Financial, Legal and Self Care.
We presented last year and the attendees loved it!!! Just in the last 6 months, I’ve taught at Yale School of Management, Freelancers Union, Barnard and more. Don’t miss this one! Is a recession nearby? No one really knows. We are NOT in one now is certain. Many economic factors seems to be leading that way but it could be tomorrow or two years from now. Long-term interest rates are lower, interest rate cuts from Fed and potential trade conflict with China seems to signal a slip in the economy. Great article in New York Times explaining it in detail! I’ve suggested the following moves/steps to client and they seem to have relaxed quite a bit. What works for you (besides staying in bed)? 1) Make A Move. Even if you don’t need the money for 20 years, just either selling a small amount into cash for bonds will feel like you are more in control and have done something. Rather than sitting watching and stressing.
2) What is Your Timeframe? If you think you need the money within the next 1-2 years (i.e. buying a home, kids going to college around the corner, saving for a business, retiring) the conservative investor in me says consider put as much as you can for those goals into cash or bonds.
3) Take a Deep Breath. Really. Connect with someone you trust - an independent financial planner, friend, family member. Share your fears and concerns, make a plan but trust that you will be fine. My good friend, Michelle Didner (and colleague who I’m co-leading The Woman’s Compass Workshop) has been instrumental in helping alleviate fears around money. No better time then now!
4) Do a Checkup. Make sure your asset allocation is commiserate with your age and retirement goals. For example, if you are planning on retiring in 10 years, you want to make sure you have at least 60% in bonds.
5) Short-term Savings. Keep them in a high interest savings account such as www.capitalone360.com, www.ally.com and www.americanexpresssavings.com. 6) Reallocate Your Mutual Funds. Consider balanced mutual funds. These are funds that have a % in stocks and % in bonds. Some of my favorites (just a suggestion: Fidelity Balanced and Vanguard Wellesley).
Want more hand holding, guidance? Don't miss my upcoming workshop on September 24: The Woman’s Compass Workshop: Guiding You Through Financial, Legal and Self Care.