Team, turn on the business channels today...and you see my point. The financial media lives for this stuff...and don't get me wrong...it's great content. But looking at what's happened to your 401(k) in the last few weeks will DO NOTHING to help your financial future!! It will just make you anxious and stressed...in which case 2 things could happen. On one hand, it might lead you to sell out of your 401(k) (an investment you're not touching for 20+ years!!!). Or, in better news....it will just leave you anxious and stressed for no reason! Why bother? Again, focus on the parts of your financial world that you can control...your spending...your tax planning...your protection plan. If nothing else, it will turn this miserable time into an opportunity for you! - GD
This is an excerpt from How To Avoid HENRY Syndrome: Financial Strategies To Own Your Future:
My point is that the TV talking heads, magazines, fund managers, guest economists on the CNBC panel, and the like, have no vested interest in sharing the sort of behaviordriven and common-sense financial planning tips that we’ve been discussing here.
Imagine if I appeared on CNBC to discuss the market and what’s going to happen over the next six months. I’d be sitting on a panel, the camera would turn to me, and Steve—the host—would ask me, “Gideon, what do you think the market will do over the next six months? Give us your expert opinion!” I’d lean back, comfortable in my chair, and laugh. “Steve, thanks for the question, but honestly, I have no idea. Absolutely no idea! The next six months could be up 600 points or down 600 points, God’s truth. But I do know that that next 6,000 points will be up. The stock market has lost 10 percent every fifteen months on average throughout history, but over that same time period, a span of over sixty years, the stock market has gone up by 150 percent. So all you people watching, if you can stomach the short-term volatility and don’t need the money next year, go relax. Watch TV and crack a beer. You’ll be fine.” My guess is that I would never be allowed back on the show. What would we talk about next week?
Everything I said is going to be as true the following week, and the month after that: not great for content!
Simply put, the cyclical nature of investing and historic undeniability of its upward trend aren’t exciting, and they don’t sell magazines.
So back to my first question, do you watch the weather channel all day?
Think about how this same phenomenon tracks with watching the Weather Channel. When you check your phone and see that the whole weekend is going to be around seventy-five degrees and sunny, that’s probably the last time you’re going to check the weather for the rest of the weekend, right? You’re saying, “I got it. It’s sunny. And it will be sunny tomorrow. I’m all set, time to tan!” People really only watch the Weather Channel when there is a chance of a storm, or rain, or snow. We want to know when it’s going to start, when it’ll end, how many inches there will be. Bad news keeps us engaged! It’s the same reality with the financial media.
Want to learn more? This is an excerpt from my book, How To Avoid HENRY Syndrome: Financial Strategies To Own Your Future.