Finding Financial Stability In Uncertain Times | Wealthy Habits
How to find financial stability in uncertain times
During uncertain times, it can be hard to feel financially stable. Your relationship with money is likely an emotional one. While some emotions (e.g. feeling safe) can be good, other emotions (e.g. fear) can be bad for your financial position.
Big financial decisions, such as buying your first home or changing your retirement plan, come with plenty of emotions attached. To make smart financial decisions and create wealthy habits, both your emotional and rational mind must be on-point.
With the unprecedented turbulence and uncertainty of COVID-19, you may find emotions taking the driver’s seat, which could lead to making irrational decisions that don’t work in your favour in the long run.
Here’s how you can do to find a better sense of financial security and form wealthy habits now.
One of the worst things for your financial health is to freak out and make panic decisions. For example, your superannuation would have taken a hit this year, as share prices dropped due to the economic impact caused by COVID-19. However, like any market, it goes up and down.
If you see your super balance drop, you may hit the panic button and switch your super investment into a more conservative option, such as cash. However, according to AustralianSuper, this may simply lock-in your losses, as you’ll be out of the market when it recovers.
The same logic applies to any stock investment. If you stay invested during a market downturn, you’re more likely to benefit when the market rebounds.
By approaching your investments with a chilled mind, you can protect yourself from rash decisions that work against you.
Stick to your plan (or make a new one)
It’s OK to feel worried or unsettled – the world is navigating through unchartered waters. However, it’s important that you don’t make impulsive decisions. When you’re feeling overwhelmed about the future, stick to your financial plan.
Your financial plan should factor for some market volatility. Without some occasional downs, there wouldn’t be ups. If you’re unsure about your plan or if your circumstances have changed, chat with your financial advisor.
If you don’t have a plan, now is a great time to create one. To quote investment goliath, Warren Buffett, “it’s only when the tide goes out that you discover who’s been swimming naked.” Don’t get caught with your pants down – make a financial plan (factoring in some rainy days) that breaks down what you need to do to reach your goals.
Focus on what’s in your control
To feel empowered with your financial position, it’s best to focus on what’s in your control. For you, it may be freeing up some of your discretionary spending for an emergency savings fund.
Or, perhaps it’s finally booking in that financial consultation you’ve been meaning to do forever. Any small action you can take that helps you feel empowered can make all the difference right now.
By getting a laser focus on what you can control and accepting what you can’t, you can lead with rational thinking to drive your actions, rather than emotions.
Talk to the experts and make wealthy habits
Having a trusted financial advisor can help you kick-ass when it comes to your financial future. Wealthy Habits is our name for a reason – we help you break down your options, feel empowered and in control of your finances, and create your own wealthy habits.
Thanks to our innovative dashboard technology, you can log in and get a complete overview of your finances. You can look at everything from cash flow to home loans, to goal timelines. It’s just one of the ways we’re helping our clients find financial security.
If you’re ready to level up and match your financial habits with your goals, then register with us now , and we’ll email a series of videos designed to change your financial habits, one at a time.
MW Wealth Management is an Authorised Representative of Consultum Financial Advisers Pty Ltd ABN 65 006 373 995 | AFSL 230323 This information is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this document, you should assess your own circumstances or seek advice from a financial adviser and seek tax advice from a registered tax agent. Information is current at the date of issue and may change. This information and certain references, where indicated, are taken from sources believed to be accurate and correct. To the extent permitted by the Law, Consultum, its representatives, officers and employees accept no liability for any person that relies upon the information contained herein