How to Stay Calm in a Financial HurricaneBy
“I can’t know exactly how things are going to turn out all right. I just know that things are going to turn out all right.” Nick Murray
“How do you stay so calm when everyone is freaking out?” a friend asked me.
As the stock market melted down through March of 2009 I was asked this question in different ways but scores of times.
In February one client said, “All my friends have taken their losses and cashed out. I’m the only one still in the market. When I go to parties and we talk about our investments they think I’m a fool.”
Some clients sent me emails of alarming news floating around the internet. Conspiracies that would end the world. Then they asked, “Aren’t you worried?”
Honestly, in the worst of it, bombarded by negativity, I suffered a few dark days. There were brief times I wondered, “Am I right? Is everything going to work out this time?”
Then I paused and reminded myself:
We’ve been here before, not the exact circumstances but similar.
We have the strongest, most resilient economy in the world. We’ve been through worse and rebounded.
Great companies are still producing goods and services people need and will buy. People have slowed down purchasing but eventually they’ll need a new car and want a new house.
And most important, God‘s still in control of my life. He isn’t thwarted by recessions in guiding and blessing me.
And then the peace returned. The gnawing worry subsided. My mind cleared. I was ready for the next round of phone calls, emails and meetings. I was steeled for the media reports announcing the “end of the world.” And in that calm I could give strength and guidance to clients when they needed it.
We all hit crises. If you were invested over the last year, you experienced a big one.
Guess what? You’ll experience more. And when you’re bombarded with bad news it causes fear and threatens mistakes. You stop thinking clearly and start reacting. Humans are wired up this way which is great if you’re avoiding being eaten but not so good for investing.
So what do you do? In the midst of a storm how do you stay calm and rational?
The Bible says, “Fix your thoughts on what is true, and honorable, and right, and pure, and lovely, and admirable. Think about things that are excellent and worthy of praise. . . . Then the God of peace will be with you.” Philippians 4:8-9 (NLT)
One word – focus.
- Focus on history. Have we been here before? What happened? How did we work through the challenge?
- Focus on the truth. What is true in all the information? Check out the sources. Take what the media talking-heads are saying with reservation.
- Focus on the good. Even in difficult circumstances there are good things going on. In this last meltdown for every company failing there were many more still profitable. But the failing ones make the news not the successful ones.
- Focus on your true source of wealth. Ultimately if you are trusting in the economy, the stock market or your investment portfolio to make you secure and happy you’ll be disappointed. Only God has that power.
- Focus on the encouraging. God’s word is filled with uplifting, faith producing promises. Read them. Let them sink into your subconscious.
You’ll face challenges in investing and life. You may be facing one right now. You may not have a choice about the circumstances but you do have a choice of how you’ll respond. If you focus on the positive it’ll make all the difference.
You’ll discover God’s peace. Your fears will subside. Confidence will flood in. And this will give you clarity of mind so you can make good decisions and take effective action.
What are you facing? What are you focusing on? Where is your strength?
If this post helps you let me know. And please share it. I appreciate it. D
Douglas Armey, the LPL Financial adviser associated with this website, practices in Fresno, California and may discuss and/or transact business only with residents of the following states: California, Idaho and Oregon.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance reference is historical and is no guarantee of future results.