REMAINING CALM WHEN UNCERTAINTY SURROUNDS US
JUSTIN VOSSEN, CFP® + INVESTMENT ADVISER, PRINCIPAL
First off, I am not a doctor so I am not going to try and discuss viral transmission rates, virology, mortality rates, or try to put COVID-19 into any analogy to make us feel better or worse. Perhaps it’s also true that many other resources know as much about the virus as I do, so please take caution.
History says that when faced with uncertainty, we as humans tend to panic. This panic leads us to our instinctual “fight or flight” reflex that comes from our hunter-gatherer ancestors hundreds of thousands of years ago. Humans feel compelled to do something.
You can see this in several ways, that now seem irrational. Remember after 9/11 when nobody would travel to New York or even get on an airplane? President Bush wore a bulletproof vest to the World Series? How about at the height of the HIV virus epidemic when individuals were shunned and ostracized from families and society, sometimes even violently? Remember when the Fukushima nuclear disaster in Japan caused a run on pharmacies of potassium iodide pills on the west coast of the United States?
At the moment, those events were rational reactions for many. Today, they might seem like an overreaction.
As it relates to your investments, nobody knows the true impact of COVID-19 on the global economy in the coming weeks. Nobody knew what the future held for H1N1, Ebola, SARS, or Zika at the height of their outbreaks. At those times, people panicked and sold only to find those investments higher days, weeks and years later.
A sound financial plan is an investor’s best defense against the “fight or flight” response. Plans are designed with the knowledge that the future is uncertain, and that negative events are inevitable. Instead of panicking and speculating, take comfort in knowing your portfolio was designed to accommodate this, and all the other bumps on the road ahead.
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ABOUT THE AUTHOR
JUSTIN VOSSEN, CFP®, NAPFA + INVESTMENT ADVISER, PRINCIPAL
Justin Vossen is an Investment Adviser and Principal at Lutz Financial. With 21+ years of relevant experience, he specializes in providing wealth management and financial planning services for high net-worth families, business owners in transition, endowments and foundations. He lives in Omaha, NE, with his wife Nicole, and children Max and Kate.
AREAS OF FOCUS
- Investment Advisory Services
- Comprehensive Financial Planning
- Business Owner Planning & Succession
- High Net Worth Families
AFFILIATIONS AND CREDENTIALS
- CERTIFIED FINANCIAL PLANNER™
- National Association of Personal Financial Advisors, Member
- Financial Planning Association, Member
- BSBA in Economics and Finance, Creighton University, Omaha, NE
- St. Augustine Indian Mission, Board Member
- Nebraska Elementary and Secondary School Finance Authority, Board Member
- St. Patrick's Church, Trustee
- Mount Michael Booster Club Board
- Lutz Gives Back, Committee Chair
- March of Dimes Nebraska, Past Board Member
- Am I Ready to Retire? Finding Your Sweet Spot
- 5 Retirement Strategies for Small Business Owners
- Outsmarting the Ivy League?
- An Investor's Year-End Wrap Up & Tax Prep
- Nobody Knows Anything
- Add "Brexit" to the Long List of Uncertainty
- Financial Planning for College Grads
- Fight or Flight - Lesson Learned
- Social Security: The New Rules
- Putting Volatility in Context
- The Asian and European Fronts
- Bubble Looming or a Bubble Popped
- Re-Emerging Markets?
- A Market Perspective
- Timing is Not Everything
- "Yellen" at the Fed
- Mind What Matters...Focus Efforts On What You Can Control
- What to do With a Financial Windfall
- Love Indexes - Hate the Indexes
- Do I Own a Market?
- A Practical Primer On Volatility