The world is noisy and messy. You need to deal with the noise and uncertainty.
Daphne Koller
There is something to be said for paying attention to what is going on in the world, but there is no escaping the fact that one of the best ways to reach a goal is to ignore the noise around you. There are many negative stories that are put in front of us each day, whether on television, the radio, on the internet and even as we hang out at water-coolers and kitchen tables. The fact remains that negative news gets far more attention from us than does positive news. This negativity can cause us to feel emotions and experience fears that do not take into consideration all of the facts. I understand this because as a member of the human race, I experience them too! Here are a few thoughts on why it could help you to ignore the noise and keep your goals at the forefront of your decisions.
10-yr stock market returns are almost always positive.
Every 20-yr stock market return has been positive.
Why would this matter? For the serious long-term investor who is working towards a goal, it can help to realize that the time horizon that you have invested your money toward has a much higher probability of achieving positive returns than negative ones. The longer you are in the market, the better your odds. Most of us have heard this but it is difficult to remember when we have a constant barrage of news about tariffs, taxes, deficits, wars, and a myriad of other things that dominate the news today. Can anyone remember the last time you turned on the television and saw a positive story leading the news, whether local or on cable? I certainly can’t. That is why I made my New Year’s resolution this year on one of my first podcasts to not check the news for the first few hours of the day. It has served me well as I have been far more productive and happy through the first 3 months!
In order for us to block things out, it is a good idea to remember that the worst 5 words that an investor can believe are “this time it is different.” Looking back on the challenges that we have faced as a country since the end of World War II, there have been hundreds of headlines that called for the end of equities, economic growth and even American prosperity. So far, they have not come true. Those who were focused on their goals, the amount of risk they were willing to take and being diversified achieved far greater success than people who stayed out because of the noise. In the long run, it is not about timing the markets, but TIME IN the market that allows you to participate in the long-term growth potential. If we are listening to all of the negativity and noise, it is extremely hard to be comfortable or confident with the risk. We have been through the inflation of the 70’s and early 80’s, the savings and loan crisis, the dot-com meltdown, the great recession and more! Yet only a couple of months ago, the stock market was at its all-time high. I can’t promise you that this time it will go higher than it was in January, but I can promise you that every time in the past that it went down, it rose to a new high and created opportunities for those who remain invested and focused on their goals.
If you are experiencing fear about what is going on, please don’t hesitate to reach out to our team at Walkner Condon Financial Advisors. We are always willing to sit down and discuss your feelings, goals, and dreams so that we can help you create a path forward that takes them all into consideration. In the meantime, turn down the radio, turn off the TV and try to enjoy the great things that you have in your life. Just ignore the noise!
Authored by Jonathon Jordan