Global financial crisis • stocks crash • global pandemic • record unemployment • foreclosures rise • banks collapse • markets in disarray • Wall Street panic • billions lost • retiree benefits take another hit • your state is bankrupt • Ebola outbreak • deep recession • lost decade • jobs crisis • housing bubble burst • economic uncertainty • double dip recession
There have been 47 recessions in the United States if you date it back to the Articles of Confederation. All of them shared two things in common:
- The news headlines have a lot in common
- Each time it was said, this time it is different
True and true. Nonetheless, a lot can be learned from these 47 recessions.
- We know there will be a next time
- We know what the news will be portraying
- We know we will think, this time is different
Recessions happen. Some have a more severe impact than others. Some will impact you more than others. Is this what your greatest fear is financially?
If you said yes, I want to challenge your answer by asking, Why do you fear something that is inevitable?
This question may seem cheeky, but it isn’t meant to be. There is purpose to that wording, so let’s take a moment to think about it: Why do you fear something that is inevitable? Depending on where you are in life, I am willing to bet it has something to do with security….
Retirement • Income • Job • Home Mortgage • Supporting Your Family
During the height of the market volatility last year, I spoke with a man who was scared to death. Guess what he said…but this time it is different. The root of his fear, though, was not rooted in what was going on with the economy and the market. He was worried about his income going down, having too much debt, and not being able to meet his obligations. He was worried about the choices he had made financially and the impact on his security. The consequence was fear.
The harsh reality is that financial fear itself can often result in emotional decision-making and this domino effect of fear cost him the entire rally of the last nine months of 2020. Ouch!
Warren Buffet, perhaps the greatest investor of all time, tells us to buy fear and sell greed. Nonetheless, the emotions get worse the longer you’ve been invested, and especially when you retire.
Let’s consider the word fear itself as an acronym:
Forget Everything And Run or
Face Everything And Rise
The bottom line is that your financial fears have nothing to do with the volatility within the economy and market. Don’t get me wrong—it can definitely fuel your fear, but it isn’t the root.
So, this is your 2021 challenge: Dig deep—what is your greatest financial fear? Once you’ve answered that, keep asking yourself the question, “Why?” Do this until you discover the root problem. Maybe you’re not confident with where your income will come from, whether or not you have saved enough, or prepared for the unexpected. The next step is to fix it. If it seems too overwhelming, you better get on it before you need an ambulance. If you don’t know where to start, this is where we come in. The main thing is that you Face Everything And Rise!