It is absolutely appropriate to feel rattled right now. If our health was the only concern, that would be a big enough burden. But so many are facing even greater stress, as jobs are lost, hours cut, and retirement portfolios are down.
My hope is that you will find a way to dig deep and not become paralyzed with fear. The only way to conquer fear is through action. And that starts with reminding yourself that you have the strength and the resiliency to navigate whatever challenges have come your way, or may come your way.
Here’s what I have done throughout my life when I have faced adversity and fear is beginning to take hold. I stand in front of a mirror and give myself a talking to: “I am a warrior, and I am not going to turn my back on the battlefield.” Sometimes I have needed to repeat it more than a few times, until I am feeling stronger and remembering that how I think, act and feel is going to have a big impact on my future hours, days and weeks.
Three warrior moves you should do right now
1. Keep investing for retirement. I get how scary the fast and deep fall in stock values feels. But if you aren’t yet retired, now is not the time to stop investing. Focus on the long term. For those of you who were working and investing when the financial crisis hit in 2008, sending stocks down more than 50%, you know that staying focused and sticking with your long-term strategy worked, as the bull market that ran from 2009 through earlier this month produced strong gains. I can’t tell you when stocks will recover, but if you have time on your side, the focus should be on the fact that they will eventually recover.
For retirees, you likely have at least half of your investment portfolio invested in bonds — likely more — and a bucket of cash. Today’s markets are exactly why you have all that money in bonds and cash. Those accounts are standing strong. As a calming exercise, add up the balances of this “safe” money and then calculate how many months of essential living expenses it could cover. Probably more than a few years, right? And if you are collecting Social Security retirement benefits, that’s steady income.
My hope is that you won’t feel the need to sell stocks right now. Give your stocks time to recover. Could stocks keep going down? Of course. But since World War II, we have had 12 bear markets. The average loss was around 35%, and though stocks fell for an average of a bit more than a year, they typically had made back their losses in another two years and then rallied to new highs. Patience will pay off.
2. If cash is low, use credit cards smartly. If you don’t have enough money in your emergency cash fund to cover expenses, use a credit card for essential purchases. But if you do this, do everything possible to pay the minimum due each month. Staying current — paying the minimum is fine during a crisis — is key to maintaining a good relationship with the card issuer. And be sure to read what I have to say next.
3. Call every credit card issuer and loan servicer and ask for help. Please listen to me: doing nothing, and avoiding all your bills is not a warrior move. If you can’t pay your bills, or could really use some short-term relief, call anyone you owe money to and ask them what help is available.
Some credit card issuers already have said they are not charging interest this month (and hopefully will continue this as long as the crisis goes on). Others are working with customers on a case-by-case basis to help. I can’t tell you that every business is going to be helpful. I am sure we will hear of bad actors in the coming days and weeks. But I also have seen news that some are in fact not stonewalling, and trying to offer help. Are there long wait times on customer service lines? So what? You’ve got time. Rather than sit on your couch worrying, get on the phone or online chat and see if you can get some relief.
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