The Writer’s Coin

Last week I wrote about how the markets have got me nervous. My reasons aren’t because my investments are losing value, it’s because I’m not sure how to best take advantage of the drop.

It’s not easy seeing your hard-earned, hard-saved money getting lobbed off at the head, but that’s just the nature of the beast. If you have a sensible plan in place and you’re comfortable with your allocations, then you shouldn’t worry.

The whole reason you came up with that strategy in the first place is to have a plan to rely on when these kinds of situations come up.

But of course, we’re human, so we worry and fret and feel like we have to do something.

Which is why I like this article over on Morningstar called “How to Cope with Financial Anxiety.”

Among the author’s advice, I offer the following highlights:

• If You Have to Do Something, Review Your Expenses
  Always a good idea. You can always squeeze a little extra out of what you already have. Some people have to do something, so here is something.
  
• Create a List of Shopping Investments
  Which is what I was worrying about myself—my list is very outdated. This is the perfect time to snatch up companies on the cheap.
• Win the Psychological Battle
  This is really the big one, isn’t it? Trust your plan. If you don’t trust it through these times, then you might need to reevaluate it.

My advice? Write down how this makes you feel. Don’t make any changes to your plan or your investments and then, when the market gets better, revisit those notes and figure out how comfortable you are with your plan. Will you trust it if the next time the markets dive (because they will)?

Once you create a plan you can trust, sticking to it will be much easier—no matter how hard your stocks are getting smashed.

Tags: financial anxiety, recession, Stocks