Thoughts from an investor

Early in my life, I learned that we often experience the greatest personal growth during the most difficult or challenging times in our life. In the last few weeks, we have all been tested in different ways. I recently received an e-mail from a client who found a new focus and clarity during his time of transition. His wise and eloquent words moved me… I wanted to share his story (with his permission) and invite you to share it with others, in the event you also find solace in his words.

Hi Sharon,

I imagine the past couple months have been difficult for you.  You’ve probably spent a lot of time with panicky clients dealing with financial issues.  I thought you might like to hear my good news story.  

My initial reaction to the market fall and an income decrease of 50% was typical panic.  After the shock wore off, I realized that I had learned (or re-learned) three valuable things that have kept me steady.  

First, I found out I can live on quite a bit less money than I thought.  And most importantly, still be happy and not feel like I’m sacrificing anything.  Working less gave me the gift of time and I’m enjoying it.  

Second, living below my means was always an abstract “prudent financial thing to do”.  I learned first hand in a very practical way how it pays off.  I can sleep at night without the worry of how to pay the bills.  That’s invaluable.  

Lastly, I learned that being a long-term investor means I can be calm during a downturn.  I reminded myself that I still own all the same assets and their value will improve over time.  But leaving things alone is difficult for me – I naturally want to fix things.  So I made a plan to bulk up my cash reserves over the next 3-4 years with the goal of having enough cash to live on in early retirement, giving my investments more time to recover if needed.  Maybe a mandatory withdrawal at age 70-1/2 will be my first dip into my investments!  
Throughout all this, I’ve been reminded of how psychological money can be and these three lessons have kept me sane and given me great comfort!

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