Thursday, September 18, 2008
Economic Fall-out? DON'T PANIC!
The economy is crashing. You can't get a loan for anything anymore. The US dollar is weak. Job security is teetering. Omg, what are we going to do???
I say... do what we've BEEN doing (that is, if you've already been practicing frugal habits AND saving your extra moolah into savings accounts and/or mutual funds, etc).
The other day, my dad made his weekly phone call to me and suggested that I cash out my mutual funds. I totally understand where he was coming from. Things seem hopeless (almost). The market's way down, let's just panic and cash out and stow our munnies into our mattresses instead!
But let me tell you something. It's a REALLY simple concept that everyone should know, especially young people. When you invest in mutual funds, and the market gets really low - it's actually the best time to put more money into those funds! How is this possible? Well... think of it as a sale. WHen the market is low, shares are priced low. So you buy more shares for your money. THEN, when the market recovers again and makes a rise, your shares blow up, when you bought a whole bunch of them when they were "on sale"! I am no financial expert, so I will say no more. I just wanted to throw this out to you. If you need more information on this, please contact your friendly neighborhood financial planner. I, of course, recommend my own planner (who is the most socially responsible and genuinely caring money person ever!), Ellen Coleman of the Oak Tree Group. If you want her contact info, shoot me an email or comment and I'll give it to you.
Um... okay, I think that's it for now. I'll be writing more about these rough times we're having when I get more moments to do so! (me busy! eeps!)
ps- I'll also be giving more tips on being frugal and saving munnies so that you CAN benefit in the long run with these mutual fund investments :)