Losing Strategies in the Current Economy – And the Winning Alternatives

Lock in Losses – If you sell your stock market holdings now, while the market is down, and bury the money in your back yard, you’ve guaranteed that you’ll lose money.  The good ol’ “buy low, sell high” motto still holds.  If you start putting money back in stocks when the market goes up, you’re selling low and buying higher.  For most people, the best advice is that if you’re in the market, stay in until it recovers. 


Hot Tips – Get your advice from reliable sources.  The guy in the next cubicle, the woman who cuts your hair, and your brother-in-law the carpenter aren’t financial advisors.  This is a great time to buy good quality investments on sale.  But don’t assume everything is the secret next home run. 


Stop Saving – Even though interest rates are in the basement on savings accounts and money market funds, everyone needs savings.  So don’t stop saving just because the returns aren’t stellar. 


Overspend – The consumption economy is how we got here.  Look at what you need and what that budget looks like.  Then get your spending closer to that needs based budget and out of the Gotta’ Have It budget. 


Markets recover.  So do individuals who make smart moves in down markets.