Financial Moves to Make Right Now
Falling stock markets and threats of massive layoffs. What financial moves should you make right now? Capital Budget Strategies, LLC, Austin’s best Financial Coach, recommends one thing: Do not panic and sell all your stocks!
As you know, the value of stock is “on paper.” Once you sell, you determine the true loss or gain. During the 2008 Great Recession, our Austin Money Coach had a friend who sold all his stocks, thereby “guaranteeing” losses.
For example, you invest $500 by buying 10 shares of Acme, Inc. at $50 a share. As the market drops, you panic when the price hits $25 and sell everything. You just went from a $250 paper loss to a real $250 loss. Almost certainly, the market with improve and the price of blue-chip companies, like Acme, Inc., will recover.
Here is what happened to Microsoft’s share price:
December 2007, it was $37 a share.
March 2009, it was $16.
December 2009, it was $30.
December 2014, it was $47
March 2020, it was $147.
Imagine if you sold all your Microsoft stock in March 2009. Better yet, imagine if you purchased stock in March 2009! Buy low, sell high as they say.
For only $149, Capital Budget Strategies, LLC, will teach you to handle your money like an adult! Working together, we will determine your true Net Worth, analyze your spending, set up a Household Monthly Budget, an Emergency Fund and a Snowball Debt Repayment Plan. We will even give you an idea how well you are doing saving for retirement. Finally, we will review your bank accounts and introduce you to on-line banking.
Do not panic during our current crisis, it will pass. In the meantime, wash your hands and do not touch your face!
This information is not meant as financial advice. This discussion is designed for most people with years until retirement. If you had planned on selling stocks in the near future to fund your retirement or a large expense, consult a Financial Advisor for personalized advice. Of course, monitor your stocks closely.
Question or Comment? Enter it below.