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I’m a prepper, you’re a prepper, wouldn’t you like to be a prepper too….

Provocative title…. we know.  If it got you thinking, that’s great!  You have most likely seen reports in the media, or even among conversations with your friends and family, that a major market crash or correction is coming.  That is quite possible that it is coming. After all, we have been in a bull market for the better part of ten years and there is a lot of noise in the news. While that is important to focus on (that fact that there is a market correction or crash looming), what is more important is what you can do to protect your investment portfolio or portfolio income sources from that correction (i.e. give you some cushion on the way down).

Understand that corrections in the market are normal:  As the old adage says, “all good things must come to an end.”  So, too, does a 10-year bull market.  But, if you understand that this is a normal part of the economic cycle, you are well on your way to ‘surviving’ a correction or market downturn.

Stick with your plan:  It is hard to tell how long a correction or downturn will last and there is no way to predict its end.  What you can do is predict your behavior.  If you have a plan (which you should have), stick with it.  The urge to purge (meaning selling out your portfolio) is emotional and can be compelling.   Selling the correction is a knee-jerk reaction.

If you are a younger investor and have time until you need your portfolio, make sure you have some cash in reserve.  If you are an older investor or are using your portfolio for income, your retirement income plan should be built to withstand a market correction or downturn.  We call that a “Reality-based Investing Plan.”   Remember, with a Reality-based Investing Plan, the income you derive from your portfolio should remain stable/constant.  The value of your portfolio, however, will fluctuate with the market.    

Get a handle on your family budget and expenses:  If you are worried about the impact of a correction, check your spending.  That includes any debt you may have.  This can be a good time and opportunity to get your own fiscal house in order. 

If correction prepping has you nervous or has you thinking that you need some assistance, please call or email our office today and we would be happy to help.