During stressful situations, our brain alerts us to "proceed with caution". That makes sense...if we were cave men or women, it might have saved our lives. Now we are living in a stressful world with the Coronavirus and it is here to stay for the foreseeable future. Having a financial plan in this new reality is more important than ever.
The “stay-in-place” directive is providing ample time for a not-so-favorite activity fondly known as spring cleaning. Last weekend I worked my way through closets and drawers, focusing on clothing. While my efforts did not include the robust Marie Kondo’s “joy” strategy, I still feel pretty good about my accomplishment!
This weekend I am focusing on files, both digital and paper. My strategy for this exercise is much better defined. Here are some helpful tips to get you going, too.
When I started writing this article it was well before COVID-19 was widely acknowledged in the US. While much has changed in our day-to-day lives, what is important to us has not changed. The silver lining in any crisis is the opportunity to make changes that will serve us better in our lives. Relationships may take on more importance, and certainly good health and well-being is a priority.
Here, in Chicago, we yearn for spring...(it's much nicer to be socially distant out of doors!). March is the daffodil month. It is also the month that seems to stand in the way of the warm weather we are desperately looking forward to. So rather than wishing March away, I decided I would try my best to enjoy March, being mindful of the gift of time. This led me to ponder mindfulness and money.
We have all seen the news on the Coronavirus flu. It is hard not to see it and, therefore, may be difficult not to react to it without a sense of panic and fear; which is exactly what investors have done over the past week.
Market volatility is a part of investing. As much as we would love for the stock markets to move upward in a straight line, it is simply not how markets can work. If they did, there would be no uncertainty and if there was no uncertainty then we would just earn the risk-free rate of return. Covid-19 (coronavirus) is doing its fair share of market disruption and, while we don't yet know the extent of the impact on the global economy, we do know that past scares such as this have not had a lasting impact on the economies of the world. Our philosophy is to always prepare clients and to manage the risk of their portfolios with a strategic asset allocation that is appropriate to their unique situation.
Significant market declines are typically short-lived relative to bull markets (as illustrated in the first chart below). To provide a longer term perspective on how markets perform after a significant downswing, the second chart shows us that over the last 90 years the stock markets typically go on to offer very strong performance after the market declines by more than 10%. So, as you can see, while riding out these periods of market volatility is never easy to do, it is what allows us to enjoy the generous returns that the markets offer over time.
Should you have any questions or would like to discuss in greater detail, please call me at 773-425-6790.
For most of our working lives, we developed a decades-long discipline to save for important life events....buying a house, kids, college and of course, retirement. Those who have reached this watershed moment often tell me how difficult (and weird) it is to shift to a spend it mindset! Creating a paycheck isn't difficult, it just takes some time and planning!
To most investors the differences between an ETF and mutual fund aren’t readily apparent. They both hold selections of individual investment securities; however, there are important distinctions in how they are constructed and how they trade. Selecting one over the other depends on several factors including time horizon, tax considerations and investment strategy.
Here is a simple truth about money: In order to get where you want to go, you have to know where you are.
When it comes to personal finance, knowing "where you are" means tallying your net worth (what you own minus what you owe) and calculating your cash flow
The Secure Act (Setting Every Community Up for Retirement Enhancement) is the broadest piece of retirement legislation passed in 13 years, in an effort to address the alarming fact that 25% of Americans have no retirement savings at all. It may appear at first glance that many of the provisions may not have a direct effect on your situation. However, there can be tax, estate planning and income planning considerations.
Change is guaranteed. This may happen more frequently as our parents age. What to do? How to plan? Here are three suggestions from our clients experiencing transitions first-hand as well as a timely checklist.
Jenifer Aronson is the Founder of Mosaic Fi.