Investing Is Hard

When I say "investing is hard", what I really mean is that staying invested is hard. Especially when the year's gains are wiped out in one day, which happened earlier this week. Or when you are bombarded by non-stop financial information, much of it negative, from many sources. Or when you can log in to your financial accounts anytime you want and watch the value decrease.

For investors of all ages, 2018 has been a difficult year. It has been a long time since investors have seen such wild swings in financial markets. Since 2009, staying invested has been easy. Sure, there have been ups and downs, but mostly ups. And the market always goes up, right? Wrong, but after 10 years we've become accustomed to positive returns.

Check out this chart:

Image 10-26-18 at 6.59 AM.jpg

The chart shows the total annual return for the S&P 500 since 2009. Obviously, 2018 isn't over yet, so there's time for the bar to go in either direction.

The takeaway from the chart is that we've had a great run over the 10-year period shown above.

I could tell you to stop checking the value of your investments, but you won't do that. Technology has made it easy for us to quickly log in to our accounts or receive automated notifications of the balance, performance, etc.

I could tell you to ignore the daily news about the financial markets, but you won't do that. There's information everywhere and it's nearly impossible to avoid.

I could tell you not to listen to talking heads make predictions about what the markets will do, but you won't do that. Like daily news about financial markets, it's almost impossible to avoid hearing from someone who knows what's going to happen in the financial markets today, tomorrow, or next year. Here's a secret: No one can predict, at least not consistently, what's going to happen.

You're human, at least I think most of you are, which means you will worry about your investments, you will be curious about the day-to-day changes in your account, and you will want to know what's going to happen to your accounts in the future.

Do one more thing, the hard thing: Stay invested.

Listening / Reading / Watching

Here's what has my attention right now:

  • Red Dead Redemption 2 by Rockstar Games. It's like Westworld minus the violent, bloody robot uprising! The original Red Dead Redemption is one of my favorite games of all-time, which means I've been eagerly anticipating the sequel. If you're unfamiliar with the Red Dead games, check out the trailer by clicking on the link above. Games have come a long way since Space Invaders and Pac-Man.