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Welcome to the FI Mastery Journey, a weekly newsletter where you receive actionable ideas from me to help tame financial chaos, get your financial house in order and live your legacy.

Here’s how it works: each week, you’ll receive one article written by me. You’ll also get three simple questions that go along with the week’s article to help jog your mind and inspire you to take small, bite-sized financial wellness actions.

And, you’ll also get an inside look at the research I’m reading.

Follow along for one year and you will have completed all the work necessary to keep your financial house in order.

My goal in all of this work?

To provide you with the tools, resources, and insights to help you take one step closer to becoming the master of your own financial independence journey.

This Week at a Glance

• Are the markets keeping you up at night? Are you worried about all the bad things going on in the world right now? Truth is, I get nervous during times like these too. This week, I cover three things I do to avoid sitting idly by when volatility picks up.
• Benchmark S&P 500 closed higher in choppy trading on Wednesday, as investors weighed an uptick in Treasury yields amid positive corporate. However, Thursday’s weaker-than-expected US GDP report could support the market’s favorable expectations of a Fed rate cut later in the year.
• Windfall regret sucks. It’s that feeling of spending through a tax refund, bonus check or vested stock award with nothing to show for it. The good news is that you can avoid this outcome. Last week I shared a simple approach to securing your windfall and giving it a purpose.

Keep Calm and Trust Your Investment Plan

Is all the news coverage of the stock market selloff bumming you out?

I don’t know about you, but I’m downright disappointed.

You know, markets have had a ripping good start to the year, and now it feels like it’s all coming to an end, right?

In fact, in the first three months of the year, the S&P 500 index, one measure of stock market performance, had its best start to the year since the pandemic.

And this stellar performance comes after watching these markets ride a rollercoaster over the past few years, with prices seemingly flying to the moon and then dropping like bricks.

But now, after having a good run for the past six months, it feels like Mr. Market is once again pulling the carpet out from under us all.

It feels like we’re all about to relive the uncertainty and ups and downs in the stock market that we did just a few years ago after finally getting back to even.

It’s just not fair, is it?

Indeed, turn on financial news, and it’s all right there: concerns about impending wars, political wranglings and upcoming elections, unabating inflation and all this ongoing interest rate policy uncertainty.

It’s enough to make you want to build a bunker and hide away for the next decade!

Now, having felt the pain of watching markets sell off in 2022 and then having it take two years to bounce back only to potentially be right back at it again, I’d be tempted to pull my money out of the markets and wait for this storm out for the time being.

Do you feel the same way?

Are you tempted to throw in the towel and just sit all of this out so you can break even?

Well, if you are, then you should know that being under-allocated in the markets could leave you with a massive case of investor’s remorse.

In other words, if you take your money out now, you could feel somewhat safe, sure.

But, you could also be left with a sinking feeling of disappointment a year from now.

You know, no one has a crystal ball to divine which one of today’s headline events could lead markets to rally or falter next week, let alone next year.

How to Avoid Feeling Overwhelmed by the Headlines

So then, given everything going on, if you’re tempted to pull money out of the markets, I’d encourage you to pay less attention to the headlines and more to your disciplined investment strategy.

That’s because if you don’t, you’ll not only miss out on gains on the other side of all this bad news, you’ll likely also throw your investing ability into question and potentially derail your long-term financial plans.

Here’s what to do instead:

Step #1: Rebalance Your Portfolio

Rebalancing your investments is crucial because it allows you to maintain control over your financial future.

This proactive approach ensures your investments align with your long-term goals despite market volatility.

Ask: “What is my current asset allocation, and how does it compare to my target allocation?

Act now to take a disciplined investing approach rather than reacting impulsively to the headlines.

Do this: sell overallocated investments and buy those that are underallocated.

Step #2: Prepare Your Sleep-well Number

Your sleep-well number should cover your living expenses or anticipated large expenditures for the next 12 to 18 months.

This approach is essential to maintain peace of mind and financial stability during uncertain times.

Ask: “Do I have enough cash reserves to handle my expenses during a market downturn?

Check your current liquid cash reserves and compare them to upcoming expenses. This proactive step ensures you are prepared for market

volatility without compromising your long-term goals.

Step #3: Trust Your Plan

An investment plan is designed to guide you through market ups and downs and capitalize on long-term market appreciation.

By sticking to your plan, you minimize impulsive reactions to short-term swings, which can derail your life goals.

Ask: “Do I fully understand all aspects of my investment plan?”

Turn off the financial news and focus on your plan.

Take the time to reevaluate your investment policy statement or understand market trends. When in doubt, stick to your plan.

I talk more about this approach in this week’s article >>>

What I’m Reading

We’re all busy in the daily rush of things. That’s why I’m sharing a list of articles that I’ve read this week to help you stay on top of your own financial independence journey.

I’ve consolidated all of these links here for your ease of viewing.

• Why Market Timing Doesn’t Work
• The Psychology of How to Stick to Your Goals
• Overthinking Your Money: Avoiding analysis paralysis
• 4 Steps to Get Over Investor Paralysis
• What Happens When You Fail at Market Timing

Thanks for taking a look!