When Things Seem out of Control, There Are Some Things You Can Control
By Saghir A. Aslam
Rawalpindi, Pakistan
(The following information is provided solely to educate the Muslim community about investing and financial planning. It is hoped that the Ummah will benefit from this effort through greater financial empowerment, enabling the community to live in security and dignity and fulfill their religious and moral obligations towards charitable activities)
During times of heightened stress, a person can quickly become overwhelmed and even struggle to do things that might be considered simple or obvious. It can be helpful to focus on the things you can control, to identify actions that you can take, and to complete those action steps.
- Review your investment plan
Before you start making changes to your investment portfolio, the first thing you should do is to consider your goals. Are you saving for retirement? Do you need to build a collage fund for your children? Did a recent event create a need to adjust your plan? If your goals have changed or if you haven’t updated your plan for a while, set up a meeting with your financial advisor to review an update your investment strategy to strategize reaching your goals.
- Understand your risk tolerance
After recent events, you may have a new definition of your tolerance for risk.
Risk is a key principle in investing. Some investments are riskier than others. But every financial decision involves risks. Risk is an inescapable, so the key is to understand your risk tolerance and manage the risk you are taking, which should be based on long-term financial goals. If your tolerance for risk has changed, review your strategy with your Financial Advisor and make sure you are still comfortable with the amount of risk you’re taking.
When the market gets volatile, investors often have an emotional reaction and may want to pull out of the market to try to avoid loss. Try to remember that moving or selling investments during a market decline will likely result in losses; staying invested may allow to benefit when the markets come back. If you haven’t updated your plan for a while, set up a meeting with your Financial Advisor to review it and make necessary adjustments.
- Organize and update important documents.
Are your important documents up to date and accessible to those who may need them? Take time to create a reference list of your documents and consider creating a digital version for easy storage and accessibility. Also, check that your beneficiary designations for investment account, life insurance and other accounts are up to date to reflect any new circumstances such as marriage, birth, death and divorce; beneficiary designations typically supersede your will so you want to confirm that your beneficiary designations are current and accurate.
(Saghir A. Aslam only explains strategies and formulas that he has been using. He is merely providing information, and NO ADVICE is given. Mr Aslam does not endorse or recommend any broker, brokerage firm, or any investment at all, nor does he suggest that anyone will earn a profit when or if they purchase stocks, bonds or any other investments. All stocks or investment vehicles mentioned are for illustrative purposes only. Mr Aslam is not an attorney, accountant, real estate broker, stockbroker, investment advisor, or certified financial planner. Mr Aslam does not have anything for sale.)
