{"id":3606,"date":"2020-04-21T10:13:50","date_gmt":"2020-04-21T15:13:50","guid":{"rendered":"https:\/\/kramerwealth.com\/?p=3606"},"modified":"2024-01-24T09:49:09","modified_gmt":"2024-01-24T15:49:09","slug":"investing-in-the-covid-19-climate-with-danny-lacey","status":"publish","type":"post","link":"https:\/\/kramerwealth.com\/investing-in-the-covid-19-climate-with-danny-lacey\/","title":{"rendered":"Investing In The COVID-19 Climate with Danny Lacey"},"content":{"rendered":"<p class=\"responsive-video-wrap clr\"><iframe title=\"Investing In The COVID-19 Climate: Danny Lacey\" width=\"1200\" height=\"675\" src=\"https:\/\/www.youtube.com\/embed\/k8jqez5ivXk?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">With today\u2019s market volatility and the economic slow down everywhere, it always leads to the question, is now a good time to invest?\u00a0 Or is now a good time to stop investing?\u00a0 So I want to address those two good questions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As we get through, how do we deal with this crisis?\u00a0 We see many restaurants closing or offering only take out; many stores are closed for a while; and we see many different news stories coming.\u00a0 Some positive but many are negative. The news information coming is so vast and coming so quickly, that it can add stress on our thinking and decision making.\u00a0 That can also impact how you think about investing for the future. First it is important to understand why you are invested in the first place.\u00a0 You may be investing to build assets for the longer term, and that is still relevant and still true.\u00a0 For the long term, investing in stocks can still\u00a0 help with that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This past March, we saw a lot of panic in many different ways.\u00a0 There was a lot of panic selling due to uncertainty and people pulling their money out. Panic is not an effective strategy for making investment decisions. \u00a0 It\u2019s good to take a few minutes to step back and reflect on the reasons for investing, the goals, and the importance of how these things fit within your strategy.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">I saw clearly the panic selling that was taking place while the market was going down.\u00a0 The US stock market was down about 33% within a short period of time.\u00a0 Then last week, Tuesday, Wednesday, and Thursday, it went up about 17%.\u00a0 And then I could see the \u201cfear of missing out.\u201d\u00a0 So we had both the panic fear and then the fear of missing out (\u201cFOMO\u201d).\u00a0 It\u2019s important to try and set aside both of those fears and have a good dialogue with your advisor to discuss how to address this going forward.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Think about it.\u00a0 If you are investing for 10 years or 20 years down the road, that is 240 months (for 20 years) or 120 months (for 10 years). So if your goal extends 20 years, you have 240 months.\u00a0 In other words, you have 240 chances to invest. 240 chances to buy shares of strong, high quality companies. You have those opportunities so I would encourage you to think in the longer-term rather than focusing on what is happening right now. This past March, we experienced extremely high volatility.\u00a0 In that case, you have the opportunity to buy at low prices which gives you a higher number of shares with the goal of building assets over time. By the time you have done that over the long term, you can build your sense of financial independence.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For those who are currently investing and have been invested in the stock market, many ask what they should be doing now. Should you pull it all out now and wait and then put it back?\u00a0 First, the idea of trying to pull out of the market and then put back in at the right time is not an easy thing to do because it requires two decisions.\u00a0 First, you can decide to pull out and then wait until things get better.\u00a0 But then you have to make another decision of when to put it back in. People may find it hard to know when to put it back in because of experience or because they are waiting for the economy to improve first. The problem in waiting for the economy to improve first is that it typically comes later. The stock markets typically react to a potential economic recovery BEFORE it actually happens. So you want to stay in the market to capture those opportunities for the good days in the market.\u00a0 By the time the economy has recovered, all of the low prices seen in most stocks are typically gone. Usually, the market has already picked up some by then.\u00a0 It\u2019s usually a good idea to just stay invested.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0There can be opportunities to look to see where some asset classes (large company, small company, international, etc) may be out of balance.\u00a0 When prices are low, it may be a good opportunity to move some funds to rebalance the portfolio.\u00a0 Rebalancing is one idea that can be practiced during times of market volatility to take advantage of low prices, consistent with the idea of buying low and selling high.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0Another opportunity is when some of your holdings have some losses from the recent volatility.\u00a0 You can sell them and use the proceeds to buy other similar holdings in order to realize the loss. Later when you have capital gains to report on your taxes, the losses can be used to offset the capital gains and reduce your tax liability. So that is another possible strategy to keep in mind.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you have a 401k and are contributing through payroll deductions biweekly or monthly, it is a great opportunity to buy shares while the prices are declining right now like we\u2019ve experienced in February and March and so far in April.\u00a0 Maybe it will continue to be in April too. Since a 401k is designated for retirement for the long term &#8211; over 10, 15, or 20 years.\u00a0 If your paycheck is twice per month, that is 480 401k contributions over 20 years. So you have 480 opportunities to buy shares.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you have money in cash or bank accounts and you feel you have a short term need for that money such as less than 3-4 years; for example, for the purchase of a home or a car or any other planned expense where you need that money in the very short term, it should not be invested. It would best be left in cash because you would need the money soon.\u00a0 But if you have funds that you don\u2019t need in the short term and are looking to invest for the longer term, such as 10 years or more, you could begin to slowly invest those funds such as on a monthly basis into the stock market.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">At Kramer Wealth Managers, we focus on each client\u2019s specific goals, short-term needs and long-term goals.\u00a0 We make recommendations on how to allocate your investment accounts.\u00a0 For example, we could use bonds and\/or stocks in various percentages, depending on each person\u2019s goals. We recognize people first; our clients are our family, cherished friends, and community.\u00a0 Our first message is to stay healthy and safe right now.\u00a0 At the same time, we will work with you to develop a plan for the long term. For our clients, we have already set up their plans in the past and many of them are still good but if adjustments need to be made, go ahead and communicate with us and we can work through it together.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>With today\u2019s market volatility and the economic slow down everywhere, it always leads to the question, is now a good time to invest?\u00a0 Or is now a good time to stop investing?\u00a0 So I want to address those two good questions. As we get through, how do we deal with this crisis?\u00a0 We see many [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":3607,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"video","meta":{"ocean_post_layout":"","ocean_both_sidebars_style":"","ocean_both_sidebars_content_width":0,"ocean_both_sidebars_sidebars_width":0,"ocean_sidebar":"0","ocean_second_sidebar":"0","ocean_disable_margins":"enable","ocean_add_body_class":"","ocean_shortcode_before_top_bar":"","ocean_shortcode_after_top_bar":"","ocean_shortcode_before_header":"","ocean_shortcode_after_header":"","ocean_has_shortcode":"","ocean_shortcode_after_title":"","ocean_shortcode_before_footer_widgets":"","ocean_shortcode_after_footer_widgets":"","ocean_shortcode_before_footer_bottom":"","ocean_shortcode_after_footer_bottom":"","ocean_display_top_bar":"default","ocean_display_header":"default","ocean_header_style":"","ocean_center_header_left_menu":"0","ocean_custom_header_template":"0","ocean_custom_logo":0,"ocean_custom_retina_logo":0,"ocean_custom_logo_max_width":0,"ocean_custom_logo_tablet_max_width":0,"ocean_custom_logo_mobile_max_width":0,"ocean_custom_logo_max_height":0,"ocean_custom_logo_tablet_max_height":0,"ocean_custom_logo_mobile_max_height":0,"ocean_header_custom_menu":"0","ocean_menu_typo_font_family":"0","ocean_menu_typo_font_subset":"","ocean_menu_typo_font_size":0,"ocean_menu_typo_font_size_tablet":0,"ocean_menu_typo_font_size_mobile":0,"ocean_menu_typo_font_size_unit":"px","ocean_menu_typo_font_weight":"","ocean_menu_typo_font_weight_tablet":"","ocean_menu_typo_font_weight_mobile":"","ocean_menu_typo_transform":"","ocean_menu_typo_transform_tablet":"","ocean_menu_typo_transform_mobile":"","ocean_menu_typo_line_height":0,"ocean_menu_typo_line_height_tablet":0,"ocean_menu_typo_line_height_mobile":0,"ocean_menu_typo_line_height_unit":"","ocean_menu_typo_spacing":0,"ocean_menu_typo_spacing_tablet":0,"ocean_menu_typo_spacing_mobile":0,"ocean_menu_typo_spacing_unit":"","ocean_menu_link_color":"","ocean_menu_link_color_hover":"","ocean_menu_link_color_active":"","ocean_menu_link_background":"","ocean_menu_link_hover_background":"","ocean_menu_link_active_background":"","ocean_menu_social_links_bg":"","ocean_menu_social_hover_links_bg":"","ocean_menu_social_links_color":"","ocean_menu_social_hover_links_color":"","ocean_disable_title":"default","ocean_disable_heading":"default","ocean_post_title":"","ocean_post_subheading":"","ocean_post_title_style":"","ocean_post_title_background_color":"","ocean_post_title_background":0,"ocean_post_title_bg_image_position":"","ocean_post_title_bg_image_attachment":"","ocean_post_title_bg_image_repeat":"","ocean_post_title_bg_image_size":"","ocean_post_title_height":0,"ocean_post_title_bg_overlay":0.5,"ocean_post_title_bg_overlay_color":"","ocean_disable_breadcrumbs":"default","ocean_breadcrumbs_color":"","ocean_breadcrumbs_separator_color":"","ocean_breadcrumbs_links_color":"","ocean_breadcrumbs_links_hover_color":"","ocean_display_footer_widgets":"default","ocean_display_footer_bottom":"default","ocean_custom_footer_template":"0","ocean_post_oembed":"","ocean_post_self_hosted_media":"","ocean_post_video_embed":"","ocean_link_format":"","ocean_link_format_target":"self","ocean_quote_format":"","ocean_quote_format_link":"post","ocean_gallery_link_images":"off","ocean_gallery_id":[],"footnotes":""},"categories":[18,16,1,23,17],"tags":[34,40,33],"acf":[],"_links":{"self":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3606"}],"collection":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/comments?post=3606"}],"version-history":[{"count":1,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3606\/revisions"}],"predecessor-version":[{"id":3994,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3606\/revisions\/3994"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/media\/3607"}],"wp:attachment":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/media?parent=3606"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/categories?post=3606"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/tags?post=3606"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}