We sent this letter out to our clients last Thursday, March 12th. As the situation progresses, the temporary losses in the market continue and there are more people getting infected by the virus every day. In the latest attempt to curtail the spread, the President is advising against groups of 10 or more people.
Markets crash all the time. You should, at minimum, expect stocks to fall at least 10% once a year, 20% once every few years, 30% or more once or twice a decade, and 50% or more once or twice during your lifetime. Those who don't understand this will eventually learn it the hard way.
Someone emailed me last week asking why this is:
Most working Americans have no clue how prepared their parents are for retirement, a knowledge gap that could hurt their own finances.
About 7 in 10 adults between 25 and 44 years old said they know little to nothing about their parents’ finances. But nearly the same share expect they will need to financially help their parents if they outlive their savings.
Do you look forward to a large tax refund? If so, you are willingly giving the IRS a tax free loan. Check your withholding to make sure you are being efficient with your hard earned paycheck!