Wednesday, August 26, 2020

Sane Investing for Crazy Times

Smart investing in the best of times can be tricky, but figuring out how to manage assets while the world is going crazy can seem impossible. The good news is that experts like wealth management firm AOG's Frederick Baerenz tell clients that even in unprecedented times, there is a roadmap to sane investing.

Act Rationally

As president and CEO of AOG Wealth Management Inc., Frederick Baerenz has helped many clients through personal and global financial crises by never letting fear win the day. Instead, he advises clients to act according to long-term financial goals rather than panicking because their assets are losing value day-to-day. 

Making decisions based on emotion can cause fearful investors to cash out of temporarily volatile markets before they understand the impact and longevity of the current trend, so he recommends investors stick to what they know instead of what they feel.

Move Slowly

For folks who have many years of earning ahead, weathering the storm is often a better strategy than pulling their money out of investments too quickly. Although there will be times when selling at a loss makes sense, those who can wait it out should. 

Not only will waiting afford the time to make better decisions, but losses to assets such as stocks and real estate also are not realized until they’re sold, making it beneficial to simply wait and see what happens.

Choose Wisely

If the time does come to sell, investors should examine each asset’s historical performance rather than worrying about how much value it is currently losing. 

Performance history provides a better understanding of which investments typically bounce back and which consistently underperform, making it easier to streamline and fortify investment portfolios for the next time the markets don’t cooperate.

No matter what causes economic upheaval, investors can prevail even in the craziest times through sound principles and a levelheaded approach.

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