Greed and Fear! When greed dominates our thought processes, we usually don’t make great decisions. When our investment philosophies are dictated by fear we are afraid of making any decisions at all, doing nothing and missing out on opportunities. Greed and Fear can impact your ability to enjoy the lifestyle you have worked so hard to achieve. We are emotional beings; it’s simply the way we are wired. We buy stocks after they have risen, exactly the time to sell, and then sell out of fear when prices fall, theoretically the time to buy. The market is far more random than rational and luck plays a significant role in the world of finance. Legendary value investor Warren Buffet joked that he liked his investments to wear both a belt and suspenders because you can never fully know the future or take all risks into account. You need a margin of safety. The US economy is interconnected with the broader global economy and regardless of where something happens, it can have an instantaneous impact. We saw this happen with the financial crisis of 2008.
What does this mean to you and what should you do about it? Perhaps you need a new way to think about your money and how it is positioned in order to protect your lifestyle in both up and down markets. We will have much more volatility in our markets and this could spell financial disaster for those not prepared. Have an open mind and explore opportunities that present themselves. We all insure our homes and there is a way to insure your retirement as well. Ask about our S.W.A.N Technique. Those letters stand for Sleep Well At Night and when it comes to your retirement assets, isn’t that just what you want to do?