What To Do In Uncertain Times Like These

Turmoil. That may be the first word you think of when you hear the word economy.  Believe me, I hear it and feel it every day too!  With talks of bank failures, bail-outs, stock values, election campaigns…whirrrrrrrrrrr BANG!  That’s what happens inside my little brain.  I tend to want to shut down and ship out.

Here’s the problem we face.  Most of the time we act in haste on feelings and forget that the feelings are a result of something that has already happened.  It’s at this point when we face the most difficult challenge of choosing the best response to our fear, anger and sadness.  In times where things seem desperate, or uncertain, remember not to react in an unhealthy and damaging way.  Take inventory and make a healthy, rational decision about what you’re going to do.

I recently created a poll on my website, www.RealScottsdaleLiving.com which asks you whether or not you believe that the United States is headed for a 2nd Great Depression.  Of 18 votes in the past 12 hours, 16 people’s opinions indicate that we are.  I’d love to know what you think about these economic times.

What about the banks?  Ahh yes, what about the banks…

The American Bankers Association says that most banks who are considered to be in trouble return to profitability without intervention, and you won’t know about it, so you won’t know if your bank is going to fail.  So let’s say your bank does fail…does that mean that you won’t have access to your money?  That depends.  If nobody buys your bank’s assets and deposits, and/or there’s no new company formed to handle the funds (usually occurs between Friday and Monday) then your money would not be accessible.  If your bank is purchased, then you most likely would not see an interruption of service.  If your funds are not accessible, on the Monday following the failure, the FDIC would begin to send you checks in the amount of your deposits.

What about the stock market?

This is where the impulsive selling could plunge you into a panic causing you to pull the trigger and sell.  If you’re financially independent and you’re not still working towards building your life’s nest egg, then you can get out of the market.  Most of us are not there yet, and the stock market has proven to be the highest return on investment over the long haul than any other investment vehicle.  Stick with it and don’t sell off just because you’re afraid of losing.  Remember, you don’t actually lose your money in the stock market until you sell.  If you’re concerned about a particular company, do your homework and move your funds somewhere else.

What about real estate?

Well, they aren’t building any more land.  The Earth has only so much of it, and since we are creatures who crave community, it’s not likely that you’ll be interested in purchasing a plot of land in the middle of nowhere unless you like that sort of thing.  Property also goes up over the long haul, and with interest rates as low as they are, and thousands of short sales and foreclosures saturating the market, as a buyer, you are in a position to reap a huge reward down the road.  My advice to you, if you have money sitting around doing little or nothing, is to buy a house.

There’s no crystal ball in any economy.  All we have are patterns of the past, and the patterns show that we grow, consistently, without fail.  We are getting smarter, more innovative, and there are more of us.  The economy has nowhere else to go but grow.  The question for you is whether or not you’re patient enough to let it happen.

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