November 3


What Could Have Been


Teenagers don't always like hanging out with their parents. This may not be a surprise. Teenagers also want to hide in their rooms. My 15-year-old son is like a ghost. I only see him when he is getting food from the kitchen. It got so bad that we had to set a five-minute timer where he had to spend time with his lame parents. Hopefully, someday, he will think we are cool.

Grammy went home today after her week-long stay. I convinced her to go check out the orchid nursery with me, where I've purchased well over a hundred orchids (Palmer Orchids is the best place, by far, in the area). Orchid addiction is a real disorder. Be careful. Above is a small portion of my collection.

She loved it. It is hard to explain the experience of standing in a greenhouse with thousands of brilliant, blooming orchids. I only purchased twelve.

The world is experiencing more war and chaos than it has in decades. Not only is it heartbreaking, but it can also be scary. Is this going to affect our economy? How are the markets going to perform well in such an environment? Should I have knee-jerk reactions to my long-term investment strategy?

Let’s try to tame some of that fear before it can take hold.

Take a look at this:

When Pearl Harbor was attacked in World War II, the market went down 7% in four days. One year later, the market was up 15.8%

During the Cuban Missile Crisis in 1962, the markets went down 10% over a couple of months. One year later, the market was up 41%.

When Richard Nixon resigned, the market dropped 13.4% in August 1974. One year later, it was up 30.2%.

In 1987, we saw a stock market crash in October, where the S&P 500 dropped 31%. One year later, it was up 58%.

After the U.S. invaded Iraq in 2003, the market was down 2%. One year later, it was up 35%.

When the housing bubble burst in September 2008, the market dropped 39% over the next two months. One year later, the market gained 49%.

What’s my point?

Even if the markets get shaky, it does not affect your financial security. I feel like I say this every week, but stop looking at your investments. It doesn’t help anything. I guess you can peak at the quarterly statements, but when you do, you first say to yourself: It doesn’t matter if it has gone up or down. It means nothing. If it’s down, it is temporary. The market will be worth much much more in ten years than it is now.


I ran into a situation this week with a new client, and I want to ensure you don’t make the same mistake.

Frank, a retired police officer, met with his financial advisor several times right before he turned in his badge. He wanted to ensure that all the pieces of his financial puzzle were put together intelligently and cohesively. But there was a BIG problem: his wife, Barbara, never attended the meetings.

Frank thoroughly understood that a diversified portfolio of stocks and bonds was a powerful and consistent way for him to make money. Frank also understood that it was OK to start spending the "money that his money was making" now that he was retired. He had big plans. Buy an old boat and fix it up. Take his wife to the Caribbean for a couple of weeks each year. And maybe join the local country club where all his golf buddies hang out.

"Barb," Frank said one day as they were drinking their morning coffee together, "I’m thinking about checking out a nice bass boat I saw online."

Barb’s eyes widened, and she stared at her husband incredulously. "What do you mean!? We can’t afford that!

Frank responded quickly, "Don’t worry about it. We are fine. My advisor says we have plenty of money. They are only asking about $10,000 for the boat. I have it all figured out. We’ll be fine."

Barb shot back, "Are you out of your mind, Frank? It said last night on the news that the Dow Jones just went way down. And you know what? Nancy next door keeps talking about this stuff she’s reading online. She is positive that the economy is about to collapse. Frank, there is no way we can spend money on stuff like this."

Frank saw the look in his wife’s eye and knew she meant business. His dreams of trolling the Gulf began to fade away…..

Moral of the Story: If you are married, include your spouse in financial planning discussions. I don’t care if you usually handle "this kind of stuff." If you aren’t on the same page as your spouse, you may end up like Frank, sitting on the sofa, watching a show about fishing, dreaming of what could have been….

Be Blessed,


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