Some Positive News
Today we’re focusing on the positive! The S&P 500 is up 6.13% (as of June 24th) and with all the doom and gloom messages as of late, we’re discussing some tips for structuring your investments and addressing adversity.
First, some Bear market stats! Did you know …
- The average length of a bear market is 289 days
- Half of the S&P 500’s strongest days occurred in a bear market
- Recessions eventually pass – we need to get through the bad so that we can get the bull market back
Simplify your investment approach
To help manage risk during the market cycles, we recommend looking at your money in 3 buckets:
- Emergency money – have 6 months of income / cash available (something you can get to in a relatively short period of time with no market exposure)
- Long term retirement accounts – invest more aggressively if more than 10 years ahead of us
- Intermediate account – (brokerage) designed for passive income and it produces interest or dividends
What does this mean? If you are proactive in setting up these buckets within your investment strategy, you are actively preparing for situations that may arise in the near and longer term. That’s risk management!
Prepare for the future by acting in the now
We all know someone that we consider an extreme prepper. The definition of the word “extreme” varies dramatically based on our viewpoint but that’s okay for this example. I bet these people all have something in common – they are sacrificing the enjoyment of today to prepare for a worst-case scenario … that likely isn’t going to happen in their lifetime.
In our lives, we are constantly being bombarded with decisions and reminders of past events. We tend to worry about things in the future or dwell on things of the past. We can only really act now.
Next time you have a problem, try approaching it with one of these three paths:
- Deal with it
- Accept it for what it is
- Leave the situation
Often our initial reaction is to worry or complain but what good does that really do? We can’t control problems, but we can control our reaction to them. We aren’t suggesting that dealing with problems is easy or straight-forward but instead of being negative, which is not productive, give active meditation (intensely focused on the moment) a try.
Be brave and be in the moment.