My mom called me up the other day. She, and numerous other people I know, have been asking me for my best personal finance advice. So, whether it’s your retirement savings or some other issue right now, I offer this: Don’t Panic!
Right now there is a lot of static in the media about whether or not we’re in a recession. And plenty of people have bandied about the words “economic slowdown.” And there has been quite a bit of stock market volatility recently. (On another note, plenty of people are probably breathing a sigh of relief in terms of rapidly falling oil prices.)
The best thing you can do is Don’t Panic! Don’t jump into the “hot” item right now, since speculation is overriding a lot of fundamentals as panic (and profit taking in the case of commodities) sets in. And don’t dump everything right now, either. Calmly assess your situation. Hold on to investments that are fundamentally sound and likely to recover. Choose this current stock market rally to cut your losses (or even cash in gains) on investments that are fundamentally a lot weaker.
Whether or not we are really in a recession doesn’t matter. You should prepare your personal finances as if one is imminent. Discipline your spending, pay down some of your debt, build some savings and take a measured approach to investing. These are things that will ensure that you will be prepared for almost anything that comes in terms of the economy.
Whatever you do, Don’t Panic!
Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional.