Watch this week’s video on this topic here.
People spend a great deal of time worrying about the election event though no one knows what’s going to happen or who is going to win. When it comes to election years, uncertainty seems to come with the territory. But there are some things you can do to keep your finances in order, even during these chaotic times.
Unless you’re doing something bad (such as not living below your means, budgeting, or saving), keep doing what you’re doing. So, literally don’t change one thing! As I said above we have no idea who is going to win (despite what the polls say), what that means for the future, or how it’s going to affect policies. Therefore, focus on what you can control and move forward with confidence.
Time in the market is more important than timing the market. So, if you’re a new investor, you shouldn’t wait. No one knows what’s going to happen at the end of the year. And in 14 of the last 17 election years, the market went up. No one can predict anything, including politics. So, don’t wait!
This is something you should pay more attention to than what will happen in the election. For example, have you maxed out your 401(k) and IRA accounts? Have you used up the entire balance of your Health Savings Accounts? And finally, have you harvested available tax losses where it’s appropriate?
Think back to the last election year. Everyone was surprised that Trump won, and a lot of people were concerned. After Trump was elected however, the market went up at least 25% the following year. You will never be successful if you have an emotional reaction with regard to your investments. In fact, it’s a recipe for disaster.
Even during these crazy times, the fundamentals still and will always matter. Take a look at your portfolio to see if you’re diversified enough. Earnings and profits drive stocks up or down. And if you don’t have a financial plan, you need to obtain one as soon as possible because it’s the most critical thing you can have as an investor.
For more advice on how you can be more successful as an investor, be sure to get in touch with Trevor Shakiba at Shakiba Capital.
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If you want to get the most from your work as an investor, you need to learn how to balance short-term satisfaction with long-term rewards. Otherwise, you can end up in a downward spiral from which there is no escape.