Fan 1: I’m going to trade him. Fan 2: Don’t do it. Fan 1: Did you even watch the game last night? He was TERRIBLE! Fan 2: It was one game. Fan 1: I’m doing it. Fan 2: You’re making a mistake. Fan 1: Phone Bloop I did it. Fan 2: Phone Bleep Fan 1: Phone Ding Why did you pick him up? Whether you’re changing up your fantasy football roster or making a change to your investment strategy, it’s important that you do not make emotional decisions and keep your sights set on the long run. Here’s an example, let’s say your favorite team is having a bad year or maybe a bad couple years and literally nothing is going your way. Do you continue to regularly invest your time, energy, and money into watching each game or do you completely write them off and move on? If you’re like most true fans, you’re going to ride out the injuries, missed passes, dropped balls, terrible defense, and so on because it’s still your team and you are invested in them for the long-haul. In the actual “investment” world, this is called “dollar cost averaging”. Dollar cost averaging is making routine contributions into the market investments over the course of your career regardless of whether they are up or down. This strategy potentially helps you minimize risk and possibly achieve a better return over time, while also removing some of the emotional stress and decision making that comes with investing. Volatility can make the game a little bumpy, but the trophy at the end is worth the struggle. Remember, the stock and bond markets have historically made a comeback after bad performance, recessions, and crashes...it just may not be as soon as we'd like. So hang in there and keep your eyes on the retirement prize!
