ENOUGH! This is the fastest rate increase in US history. Can we pump the brakes to see how it’s affected things?!?!?!
Then again, if you’re actively saving you’re like “Don’t stop, Capt Powell!”
ENOUGH ALREADY
Being “data dependent” is great and all, but if it takes anywhere from 6 months to 2 years for rate hikes to be fully digested by the economy shouldn’t we be jogging, not SPRINTING this marathon?
It feels like we’re overcorrecting and Jerome Powell will wake up in 18 months and go “Whoops! My bad!”
And professionally speaking, keeping people calm for this long is really, REALLY hard work.
It’s potentially the hardest, most stressful part of being a financial advisor. (I’m cramping from the isometric exercise.)
Quick, sharp downturns are easy. They’re over before anyone realizes.
But a long downturn starts to wear down your emotional enamel. Even if we’re only down 15%, a 16-month “wall of worry” is Game of Thrones-sized.
So for my professional sanity, I’d love for it to be over.
(For the record, I’m not worried a smidge about our Financial Zen Portfolios long-term – as long as I can keep people calm and invested.)
PERSONALLY, I’M DOING CARTWHEELS!
I sacrificed a lot building my business, and that included living paycheck-to-paycheck for nearly a decade, saving virtually nothing.
Now, I’m making up for lost ground and saving/investing like a madman. (60% of my income to be exact.)
And saving/investing into an extended downturn is MAGNIFICENT. It’s like a financial catapult.
It’s so good in fact, that I’M DELIBERATELY SAVING MORE THAN I’M COMFORTABLE WITH because it’s such a good deal right now.
Every share of every investment I’ve purchased over the last 16 months has been on sale. I’ve been able to purchase 10-30% more shares than I could have before 2022.
BUT WHAT ABOUT YOU!?!?
You should be doing cartwheels too because we’re in the same boat… err catapult.
Every penny you save and invest is being put in the same sling as my money.
During times like these, don’t focus on the money you had coming into this. (If you’re relentlessly patient, it’ll all be back to where it was before.)
INSTEAD, focus on all the new money you’re saving.
Those dollars are going to get launched to the moon once the catapult is released.
