What to do When the Stock Markets are Going Down
Since the start of the year, we have seen a drop in the stock markets. The goal of investing is to grow and build wealth, but when the markets are moving down it can be hard to see the point of investing. In this episode, I share with you what to do when the markets suck. Because ultimately you deserve to feel optimistic and excited about achieving your biggest wealth goals!
About the Host:
I am a financial professional, who specializes in helping people to achieve their financial goals. My absolute passion is creating new possibilities in people’s lives by showing them the ropes when it comes to money. I’m here to spark healthy and positive conversations around wealth and investment and create a world where nobody is limited by their financial situation. I believe this begins with education and shifting our relationships with money. I love getting to witness people achieving their most ambitious goals and creating new possibilities for themselves and their families!
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Transcript
Welcome to the wealth and wellness podcast with
Kalee Boisvert:me Kaylie Bob air, I specialize in helping people to achieve
Kalee Boisvert:their financial goals. I have a love for all things numbers, and
Kalee Boisvert:I'm passionate about financial literacy. My goal is to spark
Kalee Boisvert:healthy and positive conversations around wealth and
Kalee Boisvert:investment, and create a world where nobody is limited by their
Kalee Boisvert:financial situation. But wealth is just one piece of the
Kalee Boisvert:equation of living our best lives. So join me as we explore
Kalee Boisvert:both wealth and wellness topics. From your net worth to your self
Kalee Boisvert:worth, get ready to take confident action.
Kalee Boisvert:Hello, this is Kaylee. And thank you for listening to this
Kalee Boisvert:episode of the wealth and wellness podcast. For today's
Kalee Boisvert:episode, I thought it would be timely to talk about what to do
Kalee Boisvert:when the stock markets suck. So what do we do when they're going
Kalee Boisvert:down? When they're going essentially in the opposite
Kalee Boisvert:direction of what we would like to see, as an investor, you make
Kalee Boisvert:investments, and you you know, put your money towards these
Kalee Boisvert:investments. And the goal is really to see them go up in
Kalee Boisvert:value. And unfortunately, they do not always go upward. And at
Kalee Boisvert:times the markets as a whole move downwards. So since the
Kalee Boisvert:start of this year, so since the start of 2022. This is exactly
Kalee Boisvert:what we've been seeing the markets have continued to move
Kalee Boisvert:downwards. And that can be uncomfortable, especially coming
Kalee Boisvert:off a year, like we had last year when there was great
Kalee Boisvert:returns. Overall, the markets performed positively. And they
Kalee Boisvert:posted positive return numbers for the year. So again, it's
Kalee Boisvert:especially hard to see poor performance when we just been
Kalee Boisvert:used to seeing positive performance. And just as a side
Kalee Boisvert:note, another word that probably is coming up a lot and you're
Kalee Boisvert:hearing a lot of right now is volatility. And I just wanted to
Kalee Boisvert:quickly kind of break that down. So volatility is an investment
Kalee Boisvert:term for when the stock market experiences periods of
Kalee Boisvert:unpredictable and sometimes sharp rises and falls, it can be
Kalee Boisvert:caused by a wide range of different factors, political or
Kalee Boisvert:economic factors. And we're seeing you know, that being the
Kalee Boisvert:case right now for some of the short term events that are
Kalee Boisvert:happening. And when you see this sudden change in the market, you
Kalee Boisvert:feel, you know, as an investor, you might feel tempted to rush
Kalee Boisvert:into buying or selling behavior. And also, you know, it might
Kalee Boisvert:lead you to maybe acting too quickly, or lead to behaviors
Kalee Boisvert:such as buying high and selling low. And we're going to go more
Kalee Boisvert:into detail on that. But I just wanted to kind of as a side note
Kalee Boisvert:also include the topic of you know, volatility, when we talk
Kalee Boisvert:about this downward movement, as well, we're hitting a lot of
Kalee Boisvert:volatility, meaning there's just kind of the sharp rises or falls
Kalee Boisvert:that we're seeing as well in the market. So I want to acknowledge
Kalee Boisvert:first that is not comfortable to see the markets going downwards.
Kalee Boisvert:Because what that means is that the value of your portfolio is
Kalee Boisvert:most likely moving downward as well. When the market as a whole
Kalee Boisvert:dips, and it moves downward, there is a good chance that your
Kalee Boisvert:investments have also moved. And that's why we use, you know, the
Kalee Boisvert:market index or the market indices when we talk about how
Kalee Boisvert:the markets are doing as it provides us gauge of overall
Kalee Boisvert:market moves. And it gives us perspective as to what the
Kalee Boisvert:markets as a whole are doing. So then as an investor, if we see
Kalee Boisvert:that the markets are poor, like performing poorly, or having you
Kalee Boisvert:know, negative days, or they're moving down, this is usually a
Kalee Boisvert:good indication that your individual investments are doing
Kalee Boisvert:likely something similar. So if the markets as a whole are down
Kalee Boisvert:quite a bit for the day, you know, generally if you're
Kalee Boisvert:invested in a diversified portfolio, and you're looking at
Kalee Boisvert:indices and indices, an index sorry, that is representative
Kalee Boisvert:of, you know, how you're invested. If it's the US
Kalee Boisvert:markets, or global or Canada based and see that those all
Kalee Boisvert:move down, then there is a good chance that if you check your
Kalee Boisvert:portfolio, and your investments that they move down as well. So
Kalee Boisvert:it's a good tool as a comparison or indication of the general
Kalee Boisvert:direction of your investments to so if the markets are down, you
Kalee Boisvert:know, for the year, let's say the markets, US markets,
Kalee Boisvert:Canadian markets, global markets are all native for a year. And
Kalee Boisvert:you know, maybe the numbers a bit different for each. But if
Kalee Boisvert:you're invested in the markets and you're invested in those
Kalee Boisvert:markets, you're likely going to see that your performance
Kalee Boisvert:declines. For the year as well. So if it's negative investment
Kalee Boisvert:returns or market return story, then likely your portfolio will
Kalee Boisvert:do the same. So it gives you some perspective, you know, it's
Kalee Boisvert:nice to see your investments go up in value. And that's what
Kalee Boisvert:again, we want as investors. But if the markets as a whole are
Kalee Boisvert:moving downward, then you can't expect that your portfolio is
Kalee Boisvert:going to be doing something drastically different if you're
Kalee Boisvert:exposed and invested in the markets. So again, not
Kalee Boisvert:comfortable if you're looking at your account statement, for
Kalee Boisvert:instance, and seeing the decline, let's say you're
Kalee Boisvert:looking at, you know, your your month statement that comes in
Kalee Boisvert:the mail or over your email. And it's less than the number than
Kalee Boisvert:it was the previous month, or you're looking at the real time
Kalee Boisvert:values, and it's declined in a matter of weeks. Again, not
Kalee Boisvert:comfortable to see, of course, I do want to remind you, keeping
Kalee Boisvert:in mind that when it comes to investing, no money is actually
Kalee Boisvert:lost until a sell transaction occurs. So what you see when
Kalee Boisvert:you're looking at the value of your investment account is the
Kalee Boisvert:value of your investments valued on that specific date, or even
Kalee Boisvert:as accurate as that specific time if you're getting real time
Kalee Boisvert:updates, based on stock market, the stocks actually changed for
Kalee Boisvert:the day, obviously. And so if you're getting real time
Kalee Boisvert:numbers, what you're seeing on your account, is that real time
Kalee Boisvert:value, so you only really have that value, though, if you're to
Kalee Boisvert:sell out of your investments at that moment, and essentially
Kalee Boisvert:converted all to cash. So that value that you're seeing only
Kalee Boisvert:stands when the actual investment is sold, it's like if
Kalee Boisvert:you were living in your house and got the market value
Kalee Boisvert:assessed on your home, I mean, that's probably a little less
Kalee Boisvert:accurate. It's not there's not as much of an active market. But
Kalee Boisvert:if someone gives you an assessment, you know, you
Kalee Boisvert:obviously haven't made any money on your home, or you know,
Kalee Boisvert:cashed in on that value, until you actually go to sell the
Kalee Boisvert:house and specifically what you sell it for, that gives you the
Kalee Boisvert:number. So same is true with the markets, but there's an active,
Kalee Boisvert:you know, auction market happening, and there is buyers
Kalee Boisvert:and sellers, so you're getting that real time value of what
Kalee Boisvert:your portfolio would be worth, if you were to sell it out at
Kalee Boisvert:that, that day that you're seeing the number. So the value
Kalee Boisvert:of your investment account. Therefore, it's always going to
Kalee Boisvert:be moving a moving target almost like you're you're going to look
Kalee Boisvert:at a day to day, you know, maybe even hour to hour, you probably
Kalee Boisvert:shouldn't check it that often could get stressful, but it's
Kalee Boisvert:going to be it's going to move based on the performance of the
Kalee Boisvert:month, the markets, but money is not lost. So it's not that you
Kalee Boisvert:actually lost money. If the numbers lower this month, and
Kalee Boisvert:last month, you've only actually lost or locked that in, when you
Kalee Boisvert:actually sell the investment and recognize then you've sold it,
Kalee Boisvert:you get the cash for that amount for how many shares you sold or
Kalee Boisvert:for the position you sold. So I do want to clear that up first
Kalee Boisvert:that it's a moving number and it's not actually recognized as
Kalee Boisvert:that specific value until you actually go to sell it. So
Kalee Boisvert:depending on how you're invested the riskier portfolio, and that
Kalee Boisvert:number, it can fluctuate quite a bit if you have a lower if you
Kalee Boisvert:have just sort of like more of just an overall market exposure,
Kalee Boisvert:it can fluctuate again, especially in terms of
Kalee Boisvert:volatility. If you have much lower risk investments, maybe
Kalee Boisvert:you have more GIC based type investment for portfolio meaning
Kalee Boisvert:more like guaranteed investments, or ultra low risk,
Kalee Boisvert:then in theory, you should see a lot less fluctuation from you
Kalee Boisvert:know, day to day or month to month if you're looking at it.
Kalee Boisvert:But again, of course with that, obviously, you would expect
Kalee Boisvert:overall lower return numbers if you have something lower risk.
Kalee Boisvert:So again, nothing is actually gained or lost until a trade is
Kalee Boisvert:actually placed. The sell is made. Okay, so let's go into
Kalee Boisvert:more detail though and talk about our you know, the market
Kalee Boisvert:suck. Okay, so the stock markets year to date, again, where we
Kalee Boisvert:stand right now they are negative, and they've had some
Kalee Boisvert:pretty poor performance days with some, you know, steep
Kalee Boisvert:losses to start out. 2022 So you might be asking, now what, what
Kalee Boisvert:do I do and you might be taking action if you're a do it
Kalee Boisvert:yourself investor or you know, even if you work with an advisor
Kalee Boisvert:or you might be looking to take specific action to do something
Kalee Boisvert:so you're seeing the markets go down, they just keep decreasing.
Kalee Boisvert:And you're saying okay, what do I do I need to do something. And
Kalee Boisvert:unfortunately that question and and that response and reaction
Kalee Boisvert:might actually be doing you more harm than good. So that looking
Kalee Boisvert:for something to do might actually be you know, the worst
Kalee Boisvert:thing you could be doing And I completely understand human
Kalee Boisvert:reaction, when things are going bad when they're not going, you
Kalee Boisvert:know, when it's taken a turn for the worst, something has
Kalee Boisvert:happened that is wrong, something goes not as planned,
Kalee Boisvert:you know, our automatic reaction is to do something, we need to
Kalee Boisvert:fix it, if there's a problem, we fix it. But this approach, when
Kalee Boisvert:it comes to investing could potentially lead to even worse
Kalee Boisvert:results is what I want to suggest.
Kalee Boisvert:Then if you were to even take more of a passive approach, or
Kalee Boisvert:you know more of a not reactive, maybe more of a wait and see
Kalee Boisvert:type of approach. So the markets move swiftly, and they're
Kalee Boisvert:generally always a few steps ahead of us. So unfortunately,
Kalee Boisvert:it's very difficult to outsmart them. So if you're thinking that
Kalee Boisvert:you want to outsmart the markets, you know, they're
Kalee Boisvert:moving down. So you need to jump out of the markets well, they
Kalee Boisvert:move fast. And they do remember that they're usually a few steps
Kalee Boisvert:ahead of you. So when people try to take action, to avoid further
Kalee Boisvert:declines, or market movements, oftentimes, the changes are made
Kalee Boisvert:quite late on. And what investors actually might end up
Kalee Boisvert:doing is really the worst thing that you can be doing as an
Kalee Boisvert:investor, which is selling low, because we want to buy low, sell
Kalee Boisvert:high, like, Am I seeing this, right? It's getting late, I'm
Kalee Boisvert:taping this one is like, so we don't want to be selling low.
Kalee Boisvert:That's not the ideal scenario we want to be selling when things
Kalee Boisvert:have moved up, we don't want to be selling them at their lows.
Kalee Boisvert:But if you are selling into negative news and volatility,
Kalee Boisvert:you might end up selling at or near the bottom. And if your
Kalee Boisvert:intention is to reinvest when the time is, right, that's also
Kalee Boisvert:I would say an extremely challenging endeavor, timing
Kalee Boisvert:exactly when the right time is to invest again. So ideally,
Kalee Boisvert:finding that bottom saying, Okay, I, you know, want to get
Kalee Boisvert:out of the markets, but I want to get back in when they've hit
Kalee Boisvert:the bottom. That is really hard to do. And even the most
Kalee Boisvert:experienced investors don't claim to be experts at doing
Kalee Boisvert:this. So attempting not only to find the right time to jump out,
Kalee Boisvert:but then also trying to find the right time to come back in is,
Kalee Boisvert:again, that's basically twice as difficult to do because you're
Kalee Boisvert:trying to time two major points or, you know, events are part
Kalee Boisvert:points in the the market cycle, and trying to do both of those
Kalee Boisvert:correct. And generally, I would say for the most part, what
Kalee Boisvert:instead usually ends up happening is when an investor is
Kalee Boisvert:looking to do something as a reaction to the markets moving
Kalee Boisvert:downward, they generally sell their investments while it's
Kalee Boisvert:already on the decline or moving down. And then when they look to
Kalee Boisvert:reenter they do so a bit later on, when it's already started
Kalee Boisvert:rising and moving upward. So this means they actually end up
Kalee Boisvert:being worse off, where they've positioned themselves, because
Kalee Boisvert:they've sold well, it's going down, now they're buying back in
Kalee Boisvert:at a higher price while it's moving up. And they've just
Kalee Boisvert:essentially made it as if they invested at a higher point and
Kalee Boisvert:sold previously at that lower point. So essentially, they
Kalee Boisvert:probably in that scenario would have been better off if they did
Kalee Boisvert:nothing. And a really recent example of you know, when this
Kalee Boisvert:major kind of market move happened, and when a lot of
Kalee Boisvert:people were reacting was the the big plunge that the markets took
Kalee Boisvert:in March of 2020. Due to the outbreak of the pandemic,
Kalee Boisvert:internationally. So, you know, there's this international
Kalee Boisvert:pandemic, there's lockdowns happening around the world, and
Kalee Boisvert:the markets move down really quick as a result, and they move
Kalee Boisvert:down essentially about 30%. Again, some sectors move down
Kalee Boisvert:even more, but you would have seen a portfolio that was
Kalee Boisvert:invested in the markets potentially move down in a
Kalee Boisvert:matter of weeks, potentially, you know, 30%, or more, even in
Kalee Boisvert:some people's cases. And so that was stressful in many levels,
Kalee Boisvert:obviously, dealing with a pandemic, you know, people
Kalee Boisvert:losing jobs, a lot of uncertainty. And it was
Kalee Boisvert:difficult to see such a large decline, then, of course, to in
Kalee Boisvert:the value of your investment portfolio. But what followed
Kalee Boisvert:this swift move downwards was the markets, gaining back their
Kalee Boisvert:losses, and even moving above their pre COVID levels in
Kalee Boisvert:brackets. So I say, of course, for most sectors, so oil and gas
Kalee Boisvert:was a bit slower to recover and hasn't potentially maybe
Kalee Boisvert:overcloud recovered fully. And there's, you know, a few stocks
Kalee Boisvert:that have not fully recovered to their pre COVID levels, or they
Kalee Boisvert:were a bit slower, but for the most part, it was also pretty
Kalee Boisvert:quick recovery. So they called it this sort of V shaped that
Kalee Boisvert:was made in the markets meaning that it moved down quite quick,
Kalee Boisvert:but it also recovered quite fast as well. So for those that maybe
Kalee Boisvert:were wanting to flee during the pandemic, when it was first, you
Kalee Boisvert:know, all happening again, it moved down really quick. So you
Kalee Boisvert:might have sold down along the way, and then waiting to get
Kalee Boisvert:back in at the right time, it moved up rather quickly too. So
Kalee Boisvert:you might have gotten in a little bit later. So that's a
Kalee Boisvert:real life example of how you know trying to time the markets
Kalee Boisvert:and thinking that you can, you know, pick the right timing of
Kalee Boisvert:when you're going to be invested. It's challenging,
Kalee Boisvert:because things move quickly. And it's usually that they're
Kalee Boisvert:happening a few steps ahead of you. So I do just want to make
Kalee Boisvert:investors aware of that. So you know, something to consider
Kalee Boisvert:maybe that taking action or that response of what should I do?
Kalee Boisvert:The answer is maybe that that's not the best time to actually be
Kalee Boisvert:doing anything.
Kalee Boisvert:So I want to talk about two. So when it comes to money, as human
Kalee Boisvert:beings, we're emotional beings. And we take that emotion with us
Kalee Boisvert:to all aspects of our lives. So we definitely have that emotion
Kalee Boisvert:come into, you know, the money part of our lives. And the
Kalee Boisvert:thought of losing money doesn't feel good, because it can cause
Kalee Boisvert:a lot of emotions to come up, you know, this money could be
Kalee Boisvert:money you're saving for children's education, could be
Kalee Boisvert:money, you're saving for your financial freedom. So yes, the
Kalee Boisvert:this does bring up emotion, it's an emotional topic. And I would
Kalee Boisvert:say emotions are unavoidable when it comes to your money. But
Kalee Boisvert:that being said, I find that the best investors are those that
Kalee Boisvert:are able to separate emotions from their decisions, when it
Kalee Boisvert:comes to their money, and sort of try to look at it from a non
Kalee Boisvert:emotional lens, kind of take a step back, and have more of a
Kalee Boisvert:rational point of view, again, very hard to do in practice. And
Kalee Boisvert:for people that know maybe they're not able to do that on
Kalee Boisvert:their own, it's often you know, helpful to seek support in so in
Kalee Boisvert:the form of a financial coach, a financial advisor, any sort of
Kalee Boisvert:financial professional, having someone as your accountability
Kalee Boisvert:partner, or to keep you on track with that is obviously, you
Kalee Boisvert:know, a consideration to make if you are struggling with that
Kalee Boisvert:separating that emotion from how you're going to act or react.
Kalee Boisvert:And I'm not trying to like suggest that you get rid of your
Kalee Boisvert:emotions, again, we're emotional beings, I would say it's
Kalee Boisvert:impossible to try to just say, no more emotions. But I'm asking
Kalee Boisvert:you just to even have an awareness of how emotions can
Kalee Boisvert:play into your financial decisions. And just to be
Kalee Boisvert:careful how these emotions can be influencing your financial
Kalee Boisvert:decisions. You know, it's about avoiding the errors, that
Kalee Boisvert:emotions can cause us. So when our decision is made in that,
Kalee Boisvert:you know, very emotional based, feelings based mindset, it's
Kalee Boisvert:often you know, the things we're doing is basically, you know,
Kalee Boisvert:the things that are probably not the best things to be doing. And
Kalee Boisvert:and that's just like one area I talked about just before this.
Kalee Boisvert:So the idea of, you know, markets aren't performing good
Kalee Boisvert:I'm, I need to do something I need to react, when that might
Kalee Boisvert:be the the worst course of action for you to take, because
Kalee Boisvert:it could lead to even, you know, worse results. If you're doing
Kalee Boisvert:if you're jumping into the wrong times and selling at the wrong
Kalee Boisvert:times. And it's, you actually would have been better off maybe
Kalee Boisvert:to stay the course. And again, we saw with what happened during
Kalee Boisvert:COVID people that stayed the course, were often better off at
Kalee Boisvert:the end of the day than those that tried to jump back out,
Kalee Boisvert:jump back in. So I'm asking what I am suggesting is that you
Kalee Boisvert:avoid the emotional pull that might come up when it comes to
Kalee Boisvert:investing. And be aware of it. So just being aware, hey, this
Kalee Boisvert:is emotions coming into play is this, you know, the best course
Kalee Boisvert:of action for me to take. And just know that, you know, maybe,
Kalee Boisvert:maybe it's not as taking a step back, giving it some time
Kalee Boisvert:looking at this initial situation, and and trying to
Kalee Boisvert:maybe bring in some rational thought process process to it as
Kalee Boisvert:well. So then, you might be asking, Well, what should I do?
Kalee Boisvert:So again, the reaction is as human beings, it's okay, things
Kalee Boisvert:are going bad. There's a problem here, I need to do something I
Kalee Boisvert:need to fix it. And I'm telling you, potentially your best
Kalee Boisvert:course of action is to not react to not just jump in and do
Kalee Boisvert:something, especially because it might be very much influenced by
Kalee Boisvert:emotions. So then you're now saying, well, then what am I
Kalee Boisvert:supposed to do? What should I do?
Kalee Boisvert:So in all honesty, you know, usually the best reaction when
Kalee Boisvert:the markets are moving downward is just to not react at all.
Kalee Boisvert:And, uh, generally, you know, don't suggest to people in times
Kalee Boisvert:of extreme volatility or dips in the market, to, to use those
Kalee Boisvert:times as time to make big changes, again to protect you
Kalee Boisvert:from selling low. So if you're looking to make extreme changes,
Kalee Boisvert:those probably aren't the best times to do it, you might want
Kalee Boisvert:to just wait and give it some time and look for less volatile
Kalee Boisvert:markets to do so. You know, we don't know what's going to
Kalee Boisvert:happen on a day to day basis in the markets. But what we do know
Kalee Boisvert:is that historically, over longer term timeframes, the
Kalee Boisvert:markets have always returned positive results. Again, this is
Kalee Boisvert:based on historical numbers and over longer term time periods.
Kalee Boisvert:So we're talking 20 years plus 30 years plus 40 years plus. So
Kalee Boisvert:even, you know, when things are moving downwards, it might be,
Kalee Boisvert:you know, if you're investing right now, and seeing those
Kalee Boisvert:declines in your portfolio in those values, you might be asked
Kalee Boisvert:yourself, well, what's even the point of investing. And again,
Kalee Boisvert:that's the point is that over long term periods, investing has
Kalee Boisvert:provided investors with growth and positive results. So when we
Kalee Boisvert:zoom out, when we take a step back and look at those long term
Kalee Boisvert:charts of the stock market performance, it is an upward
Kalee Boisvert:sloping line. So there are some dips that occur, because there
Kalee Boisvert:are pullbacks markets have corrections, there are
Kalee Boisvert:recessions, there are bear markets, those have happened,
Kalee Boisvert:but still standing back and looking at that it is an upward
Kalee Boisvert:sloping line, the line still moves upward with all those
Kalee Boisvert:events that have occurred, it has still posted positive
Kalee Boisvert:returns the markets. So instead of asking the question, what do
Kalee Boisvert:I do? And having that again, very natural human reaction, a
Kalee Boisvert:better approach, I suggest is to look at instead, what can you
Kalee Boisvert:control. So like life, in general, so much of investing is
Kalee Boisvert:not in our control. And unfortunately, you and I cannot
Kalee Boisvert:affect the market performance. We want it to go up, we can't
Kalee Boisvert:just wheel it to go up and all say, well, we you know, we all
Kalee Boisvert:agree that it should go up and we want to see it move upward.
Kalee Boisvert:Therefore, let it move upward. That is just unfortunately not
Kalee Boisvert:something that could occur. And it is not in our control. So
Kalee Boisvert:what the market does, we have to remember, really remember this,
Kalee Boisvert:that what the markets going to do on a day to day basis is
Kalee Boisvert:completely out of your control. So if that's the case, what I
Kalee Boisvert:suggest you do then is focus on what you can control. And, you
Kalee Boisvert:know, what can you control that you might be saying, well, what
Kalee Boisvert:can I control if I can control the market? Well, there are
Kalee Boisvert:factors you can control when it comes to building wealth, and
Kalee Boisvert:investing. So one thing you can control is your savings rate.
Kalee Boisvert:That's how much money you're putting away. And adding to your
Kalee Boisvert:ongoing investments on maybe a monthly basis, you know, semi
Kalee Boisvert:monthly, weekly, yearly, that number that you're consistently
Kalee Boisvert:saving and adding on an ongoing basis or a recurring basis,
Kalee Boisvert:that's something that is in your control. And if you're doing
Kalee Boisvert:that, that's fabulous, especially as the markets are
Kalee Boisvert:going up and down. Because you're adding to different
Kalee Boisvert:points in the market, the markets might be up and you're
Kalee Boisvert:adding some money that month, then the markets have pulled
Kalee Boisvert:back and you're adding some more that month. And you're just
Kalee Boisvert:adding again, ongoing there, it's moving up and down. And
Kalee Boisvert:you're sort of taking the knowing, I guess accepting that,
Kalee Boisvert:Hey, I can't control when they're going up or down or how
Kalee Boisvert:much they're going up and down. But I can control saving ongoing
Kalee Boisvert:and adding on an ongoing basis. So I'm taking advantage of some
Kalee Boisvert:of these dips as well by doing so. Another thing you can
Kalee Boisvert:control if you are sitting on some extra cash that's not
Kalee Boisvert:needed in the near term, you can consider adding that to your
Kalee Boisvert:investments when the markets are down. So so many people in
Kalee Boisvert:hindsight have said that they wish they put more money or if
Kalee Boisvert:they invested during the lows of the market in 2020. Especially
Kalee Boisvert:some of the hardest hit stocks that were down much more could
Kalee Boisvert:have been down more like 80% or more, you know, people looking
Kalee Boisvert:at where those are trading now coming out of that and after
Kalee Boisvert:Mark Three covered from that. Well, so many people are saying
Kalee Boisvert:Well, I wish I would have invested or I should have put
Kalee Boisvert:more money into the markets. Well, you don't have a time
Kalee Boisvert:machine to go back in time and do that. But there are
Kalee Boisvert:opportunities to add more money at any time the markets
Kalee Boisvert:go down in value Anytime markets take a dip, that opportunity is
Kalee Boisvert:always there for you. And the markets move up and down. And
Kalee Boisvert:that's just part of the market cycle. So there was always going
Kalee Boisvert:to be more of those opportunities. So just because
Kalee Boisvert:you missed out on what happened during COVID, during 2020, when
Kalee Boisvert:it was first really affecting the markets, well, you can find,
Kalee Boisvert:you know, another opportunity and an A don't get too caught up
Kalee Boisvert:in finding the absolute bottom. But save yourself, I'm adding
Kalee Boisvert:money below the previous highs. So you're still essentially
Kalee Boisvert:getting a discount from where it was previously trading. Because
Kalee Boisvert:again, if you're going to wait and say, I'm going to wait till
Kalee Boisvert:it's the absolute bottom, and then I'm going to invest, well,
Kalee Boisvert:it's very hard to find the absolute bottom. For those that
Kalee Boisvert:maybe have or can, it could have been potentially by sheer luck.
Kalee Boisvert:But I would say on a consistent basis, that would be really hard
Kalee Boisvert:thing to predict. So even just saying, you know, when I see the
Kalee Boisvert:markets go down in value, I do have some extra cash I'm sitting
Kalee Boisvert:on, I'm going to add it to my investments, that's something
Kalee Boisvert:you can control. Another thing you can control is your overall
Kalee Boisvert:investment allocation. So being invested in a way that is
Kalee Boisvert:suitable for your risk tolerance and your timeframe. This also
Kalee Boisvert:includes being diversified in your investments. So again, a
Kalee Boisvert:portfolio that was primarily primarily sorry, invested in oil
Kalee Boisvert:and gas, it was impacted more during March 2020, then a well
Kalee Boisvert:diversified portfolio might have been where it was the more
Kalee Boisvert:evenly distributed. And this is the same with a tech focused
Kalee Boisvert:portfolio during the tech bubble, where those were the
Kalee Boisvert:companies that were the hardest hit, and those were the
Kalee Boisvert:companies that came down a lot in value. So you can and should
Kalee Boisvert:ensure your portfolio is diversified across different
Kalee Boisvert:types of investments across different businesses and sectors
Kalee Boisvert:and geographically as well. And that's something you can control
Kalee Boisvert:that is in our control. So focusing on what you can control
Kalee Boisvert:when the markets are declining, is what will serve you best in
Kalee Boisvert:continuing to build your wealth and make those smart financial
Kalee Boisvert:decisions. So it's going to help you stay on track to achieving
Kalee Boisvert:those longer term goals.
Kalee Boisvert:And this leads well when I'm talking about longer term goals
Kalee Boisvert:into another key piece of advice that I would suggest. And that
Kalee Boisvert:is about embracing patience. So what can you do when the markets
Kalee Boisvert:suck, you can embrace patience. Successful investing requires
Kalee Boisvert:patience. And there's so much proof of this, if you're reading
Kalee Boisvert:books about investing, if you follow some of the most
Kalee Boisvert:successful investors. You know, a good example that I'm sure
Kalee Boisvert:everyone's familiar with that listen to this is someone like
Kalee Boisvert:Warren Buffett, and one theme that constantly comes up from
Kalee Boisvert:his investing approach is about patience. I would say as a
Kalee Boisvert:society, this is my rant, we have so much less like less and
Kalee Boisvert:less and less patient as a whole. So we are becoming very
Kalee Boisvert:much more, you know, expecting things quick and everything has
Kalee Boisvert:to be fast. And even look at our social media consumption, we've
Kalee Boisvert:moved to this model of you know, wanting to just watch, tick tock
Kalee Boisvert:like short video formats, and that's where our attention span
Kalee Boisvert:is, is we want to be, you know, served these forms of
Kalee Boisvert:entertainment or, you know, we're only willing to give it a
Kalee Boisvert:few seconds before we want to move on to the next piece of
Kalee Boisvert:information or you know, yet pass on to the next sort of form
Kalee Boisvert:of entertainment, whatever it is that you're using their social
Kalee Boisvert:media forward. And again, this is just an example. And I like
Kalee Boisvert:tick tock, I get stuck in the the realm of watching tick tock
Kalee Boisvert:videos. But again, I think it just speaks to how short of an
Kalee Boisvert:attention span we have and how quickly we want things even in
Kalee Boisvert:our behavior with like online delivery. So we used to be okay,
Kalee Boisvert:when we ordered something online. It might take weeks to
Kalee Boisvert:get there. And that was like okay, yeah, it'll get here in a
Kalee Boisvert:few weeks. Now we expect it in the same day and even more on
Kalee Boisvert:that. It's like no, we expect it now, can we get it within hours?
Kalee Boisvert:Can we get it sooner? And that's how everything is moving that
Kalee Boisvert:quick, quick, fast, fast. So asking and expecting patience
Kalee Boisvert:and investing I would say is very difficult with these
Kalee Boisvert:shifting expectations. But it's so important. And when we look
Kalee Boisvert:at like our investment performance and return numbers,
Kalee Boisvert:again, we want to take that patient approach we want to look
Kalee Boisvert:back and say okay, what are The numbers like return numbers,
Kalee Boisvert:we're seeing over five years, over 10 years on your portfolio
Kalee Boisvert:or in your investments over 20 years, what are those return
Kalee Boisvert:numbers look like? Short term events are always going to
Kalee Boisvert:happen. And for the most part, I would say most short term events
Kalee Boisvert:are the ones that are really tough to predict. But what
Kalee Boisvert:matters and impacts your overall wealth is not your investments
Kalee Boisvert:did necessarily this week, or this month, it's how they
Kalee Boisvert:performed on that longer term basis. And again, this, of
Kalee Boisvert:course, the caveat to this is keeping in mind, you're
Kalee Boisvert:investing appropriately for your timeframe. So if you do have a
Kalee Boisvert:shorter term timeframe, let's say I'm saving for a down
Kalee Boisvert:payment within the year, you know, move putting the money in
Kalee Boisvert:the markets, and hoping for big gains over a short time frame,
Kalee Boisvert:not an ideal investment scenario. So I'm talking about
Kalee Boisvert:investing in a sense of expecting long term growth
Kalee Boisvert:numbers. So in that sense, it does take patience, and probably
Kalee Boisvert:more patience than you, you or I, or anyone, again, in this
Kalee Boisvert:changing the sort of dynamic of instantaneous and how quickly
Kalee Boisvert:we're consuming and wanting things. That is probably much
Kalee Boisvert:more patience than we're comfortable or used to, to think
Kalee Boisvert:of like, wow, two year return numbers, three years, five
Kalee Boisvert:years, 10 years. That's crazy, like, what else are you looking
Kalee Boisvert:at for 10 years. But that is important. And that's vital when
Kalee Boisvert:it comes to investing. Because those longer term numbers
Kalee Boisvert:provide you with a much clearer representation of your overall
Kalee Boisvert:performance, and a much better indication of your progress
Kalee Boisvert:towards your goals when it comes to investing. So if the goal is
Kalee Boisvert:saving for your financial independence, or retirement
Kalee Boisvert:number, then I don't want to see you know, what your performance
Kalee Boisvert:has been for the week? Or what your results are you want to be
Kalee Boisvert:looking at? Well, where's my portfolio gone over the last
Kalee Boisvert:five years, 10 years? How much has it grown and compounded
Kalee Boisvert:towards that goal? And, you know, if you're, if you're doing
Kalee Boisvert:that you're getting a much better view of okay, am I on
Kalee Boisvert:track? Am I moving towards that goal, rather than looking at the
Kalee Boisvert:day to day, because the day to day fluctuations can drive you
Kalee Boisvert:crazy. And if you base sort of where you want to get to, based
Kalee Boisvert:on the day to day, it's going to be all over the place. So you
Kalee Boisvert:have to really put your goals into perspective. And if the
Kalee Boisvert:money is for your retirement savings, and you're not even
Kalee Boisvert:looking at it to draw on that for 15 years plus, then is it
Kalee Boisvert:really worth your time really stressing out and looking at the
Kalee Boisvert:day to day fluctuations that are happening right now? I would say
Kalee Boisvert:probably not. So I'm not saying you know, ignore your
Kalee Boisvert:investments all together and take a peek at them in 10 years
Kalee Boisvert:time. But I am encouraging you to look at the bigger picture
Kalee Boisvert:and see, am I moving towards that goal? When I look at that
Kalee Boisvert:bigger picture, from a, you know, five year perspective from
Kalee Boisvert:a 10 year from a 15 year. That's what really matters is that
Kalee Boisvert:getting me closer to my goal. Again, the day to day, it's
Kalee Boisvert:really hard to gauge from the day to day with all the
Kalee Boisvert:volatility and fluctuations. So we do have to take a step back
Kalee Boisvert:and look at the averages over longer terms to get a clearer
Kalee Boisvert:picture on performance and progress toward the goal. So I
Kalee Boisvert:hope this episode has helped to relieve some of the stress or
Kalee Boisvert:anxiety over crappy markets. And you know, when the markets suck,
Kalee Boisvert:I don't like it either. So I'm on I'm on your side. But I you
Kalee Boisvert:know, I urge you to not let market performance get you down.
Kalee Boisvert:Because I do believe that when it comes to money and wealth
Kalee Boisvert:building, you deserve to feel optimistic and positive about
Kalee Boisvert:your money and your wealth goals and know that you're going in
Kalee Boisvert:the right direction. And I know sometimes that's hard to do
Kalee Boisvert:again, with that short term day to day what's going on. But if
Kalee Boisvert:anything, I hope this episode has helped kind of ease some of
Kalee Boisvert:those concerns and the stress and anxiety and look at that
Kalee Boisvert:bigger picture. So thank you so much for listening in. I hope
Kalee Boisvert:you enjoyed today's episode, and I will catch you on next week's
Kalee Boisvert:episode. Thank you so much bye for now
Kalee Boisvert:I hope you found value in this episode. And because I'm such a
Kalee Boisvert:proponent of taking confident action, I want to pose a
Kalee Boisvert:question to you the listener. What is one action that you feel
Kalee Boisvert:inspired to take after listening to today's episode if You enjoy
Kalee Boisvert:listening please subscribe and share with your friends and
Kalee Boisvert:family thank you so much and I will catch you next time
