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Whether you are a seasoned investor or just starting out, we all experience periods where things aren’t going as we had hoped. When the stock market moves higher, you feel great because you are making money. But what about when the market moves lower? Are you concerned that your current stock market investments may not be right for you? Have recent events left you second guessing your decisions or left you unsure on what to do next?

Frustration can easily set in whenever your investment account has less money than planned. Each of us work hard for our money and need every penny that we earn to work for us over the long term. If negative thoughts are popping up in your mind you might even be a feeling a little down on yourself but there is no need to feel this way because you have the power within you to change your perception. Start out by focusing on what is going right and the positive steps you’ve taken in the past. Next, you’ll want to map out a plan of action that will help you to get what you want. It doesn’t matter how deeply you are invested, now is a great time to put strategies in place that will help alleviate any stress or uneasiness you might be feeling.

I know from personal experience that it can be a bit scary when the market is falling 1-2% a day, and continues to drop a few days in a row; then before you know it, you have lost 5-10% of your money. If the stock market is in a serious decline, more money will be lost. Getting stressed out isn’t the solution. You must remember that investing in the stock market as a marathon, not a sprint. Investing is a long term commitment. More times than not, taking no action works in your favor because the market comes back. You’ll notice when you take a long term approach that the market will experience incredible gains; however sometimes the market falls even further and quickly you are down 20%. It’s easy to become very stubborn when an investment is losing money and the investment should be sold.  Taking a loss can sometimes be very hard to do, especially on your psyche but you can take charge of your finances. You can protect your assets and you can grow your wealth. Since there is an ebb and flow you must stay steady and remain on course so you are in the best position to make informed investment decisions over time.

“Losing is a learning experience. It teaches you humility. It teaches you to work harder. It’s also a powerful motivator. – Yogi Berra

Controlling risk is necessary if you want to make money consistently. It’s common when you invest to either do nothing or panic because you are not sure what to do. It disturbs me when I hear statements such as:

“It will come back”.

“It’s only a paper loss”.

“It’s not a lot of money”.

Or “I have a small investment”.

Why put yourself in a position to risk 10-20 % of your money in the first place? As the market declines, fear escalates rapidly. Take it from me; it’s a much better idea and good portfolio management to take a small loss.  Even if you are wrong and the investment goes higher, you can always buy a different security. In the long run, you will be more profitable by taking the loss rather than allowing it to escalate.

Be Flexible Building Your Wealth:

  • You need to protect your capital, keeping risk in the forefront of your mind.
  • Review your investments so you are comfortable.
  • Make a plan that has an exit strategy so losses don’t build in a poor market climate.
  • Your investments should be flexible, and enables you to reduce or add to your investments in small or larger increments. This can help you to be more profitable and avoid the anxiety, the stress, and the indecision that sometimes causes you to become frozen as you do nothing but watch (sigh).

Even as a portfolio manager of over 30 years there have been times where I have experienced worry and indecision. As human beings it is impossible to be perfect, especially in the market where mistakes happen just as they do in everyday life.  I have learned from those mistakes and realized over the years that lessons are here to help us grow. What about you? Are there mistakes in your past that you have made that still stick in your mind and you’ve been unable to let go of? If so, then it’s time to let them go. It’s time to say good bye. There is no gain in beating yourself up. No benefit at replaying what has past. Doing so negatively impacts your health, keeps you from giving yourself the forgiveness you deserve, and you never fully grasp the lesson when you’re unable to move on.

For example, a big mistake I made in the 90s was when I watched an investment move from 1/16 (virtually no money to be made) to over $3 in just one day.  I had never seen this happen.  Big money was lost, however the amount of money saved over the years from the experience was priceless. The lesson I needed to learn was never hold an investment where the risk is not worth the reward. Manage your risk. Something unexpected could happen that moves the stock market and will surprise you when you least expect it. Lessons can cost in the short term but when you learn from them they pay for themselves over time. This one negative experience helped me become a better money manager and sustain financial well-being for years to come.

Another thought to consider is if you are stressed out about your investments then your portfolio might not be suited for your needs. A clear investment plan that is flexible will be exactly what you need when the stock market becomes more challenging and you are not sure what to do. Start with implementing a plan that manages your risk and protects you against serious loss. Make sure that it allows for enough risk for gain but isn’t extended too far beyond your comfort level. You can become successful investing in the stock market when you take your own comfort level and investment goals into consideration.  You just need to be aware and in tune with your own wants, needs, and desires. Small changes can make a huge difference and can make all the difference in relieving the stress associated with your finances.

Adjusting your perception and implementing a plan of action can help in all aspects of your life. You can create real change within your finances now, and achieve your investing goals with less stress by steering away from the negative thoughts that can cloud your judgment. Empower yourself by learning new ideas that will help you build more wealth. It will be time well spent because the experience and the lessons learned will build a strong foundation for better decisions in the future.

Take some time and invest in yourself with my…
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My hope is that these words and my training will help you grow within as you grow your finances. Send me a note if you need some help with your plan or have some questions.

To your health, wealth, and happiness,

Bonnie Gortler
The Inspired Wealth & Well-Being Coach

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