Subject: “What Do We Do Now?”
Dear Valued Investor,
“What do we do now” has been on the mind of many investors now that Russia has invaded Ukraine. We see it on the news, we hear it from friends, and receive texts from family members. It may seem that now is the time to act, but your team with over 50 years of investment experience at Butson Financial Advisors LLC is here to say one thing; do not panic.
While the future of Ukraine is unclear, more than 77% of the S&P Index that has reported Q4 results have surpassed expectations*. The U.S. economy is strong. Businesses are recovering from the Covid pandemic. Midterm elections are held this year meaning incumbents will do all they can to help improve the economy for their voters before we head to the polls.
During periods of volatility, it is critical to keep to your Financial Plan. Reacting to the markets can be detrimental to a portfolio, especially when someone is within 5 years to retirement. Here is a list of action items that may help weather the storm.
- Stick to your Financial Plan. Markets have already reacted to the invasion, but we can control the amount of risk we take, the timeframe for investment accounts, and the amount of emergency savings we keep at the bank.
- If appropriate, rebalance accounts. This selloff could be an opportunity to take conservative funds and purchase more aggressive stock investments (if this fits in line with your financial plan).
- If you are working, continue contributing to your retirement plan. New contributions may take advantage of a lower equity price.
- Wait for the market to rebound, and then have a discussion about next steps.
- Continue the quarterly reviews with your Advisor at Butson Financial Advisors, LLC.
Market volatility is never easy to stomach, but we have seen this before. In 2008 we had a mortgage crisis and in 2020 we had a Covid pandemic. Periods of volatility are difficult to internalize, but sticking to your gameplan and not panicking has historically proven beneficial to investors.
Our office has over 50 years of experience in investment management. We welcome any questions or comments during this period of uncertainty. Thank you!
Grant H. Butson
Partner, Butson Financial Advisors LLC.
*According to LPL Research Daily Market Update 2/11/2022 Tracking #1-05244030.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and my not be invested into directly.
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.