REMAINING CALM WHEN UNCERTAINTY SURROUNDS US
JUSTIN VOSSEN, CFP® + INVESTMENT ADVISER, PRINCIPAL
PUBLISHED: FEBRUARY 28, 2020
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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Important Disclosure Information
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Lutz Financial), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Lutz Financial. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Lutz Financial is neither a law firm nor a certified public accounting firm and no portion of the newsletter content should be construed as legal or accounting advice. A copy of the Lutz Financial’s current written disclosure statement discussing our advisory services and fees is available upon request.
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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
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
- Nobody Talks About Rick Anymore?
- The Current Financial Health of the American Consumer
- A 100-Year Bet Gone Bad
- Personal Finances: Focusing on What You Can Control
- Planning for College Pragmatically
- Remaining Calm When Uncertainty Surrounds Us
- 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