How to Tune Out Chaos

Apologies for a being a day late with this post! My little musical parody Vape had it’s Town Hall benefit concert on Tuesday and I am still recovering. I’ll attach a link to professional pics below!

You may have noticed the stock market is…….down. Like kind of a lot. Like we are very nearing a full correction and there may or may not be a recession on the horizon. So I’ve been getting a lot of questions about what you should do with your investments.

And as always, my vague annoying answer is “IT DEPENDS”

If you’re young and have time - this is actually a good thing! If you have cash to invest, investing while the markets are down is like buying during a sale. You’ll get more bang for your buck and you can participate in the upside when the markets recover.

The second best option is do nothing! Don’t look at your accounts, don’t panic sell, don’t try and “time” the market. Sit back and let this play out and let the markets recover over the next year, decade, so on. It’s the folks who panic who lose every single time.

If you’re someone who is nearing retirement or already retired, you probably want to throw a tomato at my head right about now. You definitely are in a delicate situation and there are a few tips and tricks for you as well.

1. Asset allocation. You may need to adjust how your portfolio is allocated. Moving from a higher equity allocation to more conservative (i.e. bonds and other fixed income products) may be prudent. Completely selling all of your investments in a panic and keeping everything in cash under your mattress is absolutely NOT the answer. You still want to participate in an eventual recovery and stocks have traditionally been the best method to keep pace with inflation. Proper asset allocation is key to keeping your money growing while also reducing as much risk and volatility as necessary.

2. Make sure you have enough cash. Keeping a larger emergency fund in a high yield savings account — as much as even 12-24 months of living expenses — will really help should the markets tank for a bit. You don’t want to get caught without any cash and need to liquidate your investments at a low because of an emergency.

3. Know your withdrawal rate. If you’re taking money out of your investment accounts during retirement, you may need to temporarily adjust your withdrawal rate. If we head into a recession or markets are way down for the next several months or even years, you’ll need to reduce the amount you’re taking out to ensure your portfolio lasts as long as you planned.

4. DO NOT MAKE MONEY DECISIONS BASED ON EMOTION!!! Yes, everything and everyone is volatile right now. BUT you are only hurting yourself and your future if you make money decisions based on your feelings. It is a mistake I have unfortunately seen made too many times. Control what you can - have proper asset allocation, a healthy emergency fund, review your financial plan, and then put your phone and/or laptop down. Doomscrolling/viewing is profoundly unhealthy for your wallet and mind. Trust me on this one.

Now go look at this sweet pics from our staged reading the other night!!

Playbill Photos

I love to love ya - thanks to all who came out to see Vape this week. More on a future run off-Broadway soon!!!

-Catie