Good Financial Reads: When Markets are Down

Build Some More Room for Error into Your Finances

by Meg Bartelt, CFP®, Flow Financial Planning

How are you feeling? After the chaos of the last few weeks and months in the markets, the economy, and national politics? After the last couple difficult years in the tech employment scene?

When things are going well in your life and career and the markets and the economy, you probably don’t think much about having “room for error” in your finances. Error, what error?!

Welp, I’m guessing so-called Recent Events have made “error” very obvious, and the idea of making room for it might sound pretty good, eh?

Three stories from my life in just the last two weeks have made me think about how valuable “room for error” is. [To give credit where credit is (probably) due, I think I got this specific phrase from the engaging, thought-provoking book The Psychology of Money.]

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Tariffs, Turmoil, and Truth: Debunking the Fear of Economic Collapse

by Ben S. Lies, MBA, RSSA, Delphi Advisors

We currently find ourselves in a very volatile market driven by fear and uncertainty courtesy of the expansive tariff policy being enacted by the Trump administration. As I write this article, the S&P 500 is down 4% in a single day, which represents the largest one-day selloff since 2022. This volatility encapsulates the fear generated by these policies. I am not going to sugar coat it: tariffs are bad policy that will detract from US and global growth in addition to likely resulting in higher prices for consumers. However, the fear and market volatility associated with these tariffs appears to be overblown. Of course, there are negative and unseen risks, but the market appears to be pricing in a full-blown recession, which seems a bit hasty in my view. That being said, policies like this are going to hit certain people, families, and businesses very hard, and my thoughts go out to these folks. With that said, in my analysis, a full-blown recession and bear market caused by these tariffs appears to be unlikely.

To understand what the true effect of these tariff policies may be, we need to understand what tariffs are, what they are not, and the logistics of the implementation of tariffs in the real world.

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How to Protect Investments from Stock Market Crash: Using Data, Keeping Perspective, and Playing the Long-Game

by Eric Roberge, Beyond Your Hammock

Feeling anxious, concerned, worried, hopeless, or fearful of what comes next when markets start reacting to current events and headline news?

If you’re human, the answer is probably yes.

It makes perfect sense you’d feel this when the market suddenly becomes a highly volatile place and you see your 401(k) or your investment accounts bleeding value.

It also makes sense because you’re not just worried about the market. You’re worried about the implications of whatever made the markets start roiling.

Anxious about what it means for your job, your family, or your community. Worried about unrest, disruption, and chaos in the wider world.

Given all of the concern or anxiety around not just finances but the world around us, it makes sense that your first reaction to seeing market volatility or unrealized losses in your portfolio is to try and draw back. To do what you can to protect what you have.

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When Things Are Looking Down…

by Keith Spencer, Spencer Financial Planning

It's never fun to see your investment balances going down. And there's a good chance that's exactly what has been happening to your portfolio the past month or so, with all this talk of tariffs, trade wars, and global slowdowns. You're welcome for the reminder. But how should we be thinking about our investment portfolio when things are looking down?

Let's take a step back and think about the role of different components of your portfolio.

What has been going down lately? Stocks.

What's the role of stocks? To provide long-term growth. 

Of course, everyone wants short-term growth too. But that's not why we should be holding stocks. They are volatile by nature. They can't be trusted to produce good returns over short periods of time.

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