Time To Stop Paying The Price of Fear
January 24, 2013
When we look back at 2012, we see enormous angst surrounding the economy and the stock market – the fiscal cliff, China’s threat of a slowdown, the U.S. election, higher taxes, another recession and many other uncertainties over which we have no control, and rarely turn out as we think. It’s easy to get paralyzed with fear, which keeps people from making the right decisions.
Many people have their money (trillions of dollars) sitting in cash or bonds and are not taking advantage of the gains in the global marketplace. Their fear warns them, ” The market is just waiting for me to get in. I know the minute I get back in it will go down.” No one wants to be the sucker.
A perennial challenge for investors is: if you get on wrong side of strategy, how do you know when and how to get back in? My goal is to give you strategies so you will never be on the wrong side.
Don’t buy into the fear. If you are looking for a level of surety or guarantee, there are T-bills, which pose no risk and pay very little return. If you’re afraid of the short-term, you’re not likely to be a successful investor. The short-term is always fraught with danger, which is why it’s important for you to know why you’re doing what you’re doing, and invest for the long term.
I guarantee that if you invest properly, you will lose money. Your responsibility is to know what that loss will be, and be willing to live through it. If you are stuck in fear and uncertainty, I encourage you to go back and read the basics again, which are available in my “How To Invest Series” and other books. If you want to know more about the fear you may be feeling, read Jason Zweig’s “Your Money and Your Brain.”
I hope you will take “the long view” and be confident in your sound investing decisions. Let me know how you’re doing.