A down market can stir up a lot of emotions. We get it. But our decades of experience tell us to take heart that this too shall pass. Here is a short video that can help put this into perspective.
Rex Clevenger: When the markets drop significantly, as they recently have, you might expect that the phones in our office are ringing off the hook, but in reality, we generally get very few calls from clients who are concerned about their portfolio.
This is because we strive to spend the time necessary to understand our clients’ needs, while explaining the risks and what they mean for their portfolio – in actual dollars. In other words, we want to help you understand that downturns are expected, we’re prepared for them, and there’s no need to panic.
Wendy Cox: We stress test your portfolio and show you the data. If you’re uncomfortable with the projections, we make adjustments.
It helps to put things into perspective. Take a recent market correction for example. That looks and feels awful, we get it. But zoom out over history, and it becomes a small blip in time. As you can see, some of the biggest market corrections – like the one caused by the financial crisis in 2008 – have been followed by some amazing rebounds.
Rex Clevenger: The rebound may be one or two years away, but regardless of your age, your investment strategy should be designed to last for the rest of your life. To be successful, you must ignore the media hysteria, and not allow your emotions to take over.
Timing the market typically DOES NOT WORK! Just take a look at what a $100,000 investment in the S&P 500 grew to over the 20-year period between 2001 and 2020. $425,000! This included 9/11 and the great recession. But if you missed just the 10 best days your investment grew by less than half as much, and if you missed the 25 best days in 20 years, you actually lost money! And look at this! 22 of the 25 WORST days in the market were within one month of one of the 25 best days!
Wendy Cox: While these stock market statistics are interesting, we understand that emotions can still get the best of us. We want you to have confidence, so if you ARE concerned or DO have questions, don’t hesitate to give us a call. Because as Rex said, our phones are NOT ringing off the hook, and we will have plenty of time to visit with you.
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