Protecting Your Investments In Times of Economic Crisis

The United States economy is currently experiencing a serious financial shake up. No one really understands just how deep or how far reaching the damage is going to be, but what we do know is that there is going to be damage, and that we are going to be at the mercy of the markets and the world economy while we try to deal with the backlash from this particularly messy financial shakeup. Here are a few really important steps that you can take when it comes to protecting your investments in times of economic crisis.

1 - Stop making rash decisions.

If you can walk away with one piece of advice, let it be this one: Turn off the television and stop watching the news reports. Government bailout plans and plunging markets may make excellent headlines, but they are not what you should be basing your trade decisions off of. It is absolutely, perfectly reasonable for you to want to keep up with the events as they unfold, but do not allow your investment decisions to be based on the latest updates from the media circus. They are trying to stir up drama, don't let it affect your portfolio.

2 - Analyze your Financial Sector Exposure

Whether you hold individual stocks, ETFs or mutual funds, you may have a lot more exposure than you are actually aware of. If you own the S&P 500 index, then you are 15 percent invested in financial firms alone for example. Even with the Federal government stepping in to provide aid, banks and financial institutions are still going to face an uphill battle in the coming months or even years. If you are holding a lot of financial stocks, then you need to make sure you understand how these companies are making their money, and what risks are available to you in today's market. If you are going to invest money in these and other financial companies, you should only choose the ones that possess strong balance sheets, some measure of transparency for peace of mind, and conservative standards for lending. Risk takers like Fannie Mae and Lehman Brothers got themselves into trouble by lending recklessly, but BB&T and Wells Fargo on the other hand are going to emerge from this crisis in a much better competitive position than ever before.

3 - Use drops in the Market to find Newer Opportunities

You can make the most out of your money in a bear market, you just do not normally realize it. The bright side of sell offs in the market is that you can actually snap up a lot of terrific investment vehicles that have been dragged down with the market. Housing prices are declining, the economy is in a tailspin and credit is tightening, but during this deflationary period you can actually make some pretty smart investment decisions that will benefit you in the long run.

Photo Credit: 1

Originally posted 2008-11-19 05:49:06. Republished by Blog Post Promoter

Blog Traffic Exchange Related Posts
  • blog traffic exchangeReview: The Teen's Guide to Personal Finance: Basic concepts in personal finance that every teen should know. Time is a resource that many teenagers don't realize is their greatest resource for finacial independence. "The Teen's Guide to Personal Finance" is a tome that will provide teenagers with important financial lessons, in a manner which will pull their interest and convey itself effectively in its intended task. The......
  • penniesRecession Not Through With Us Yet While it may seem that the nation's economy is taking a turn for the better and strides toward the positive are being made, the recession times we have been experiencing are not exactly over. With so many people starting to regain confidence in their personal finances again with just the......
  • paycheckHow to Stop Living Paycheck to Paycheck Right now, more than 80% of households in the United States live on a paycheck to paycheck basis. This means that a lost job could result in financial disaster for a large chunk of the population. Once you get into the trap of relying so heavily on one paycheck, it......
  • 1032981157_b66d4352d5_mTop 3 Things to Learn About Personal Finance Regardless of your age, position in life, or your financial goals, there are a few things that we all need to learn about personal finance. Once you have the basics down, everything else can just flow naturally. These tips are the strong foundation upon which you can build your financial......
  • houseHow to Protect Your Pension in the Credit Crunch As news of bank failures continues, and government officials are debating a $700 billion bailout plan, many consumers are starting to worry about the state of their pension plan. If you have it invested in the wrong stocks, you could end up losing it all, or at the very least,......
Blog Traffic Exchange Related Websites
  • cello1A Cello Buying Guide Shopping for a cello can be a difficult and costly decision. This guide will give you some pointers on what to look for and how to avoid wasting money on the wrong instrument for your needs. If you are buying a cello for your child, you may want to consider......
  • golf shoesHow to Find the Right Golf Shoes Having the right pair of golf shoes impacts much more than your comfort level. If you’re wearing the wrong shoes or if they do not fit properly, this can effect your swing and as such, your entire game. Most of us don’t pay attention to our feet in golf,......
  • Paper MoneyPaper Money Coins and Paper Money -> Paper Money: US -> United States Notes Paper money has a long and varied history that dates back centuries. Although we are used to dealing with paper money on a constant basis it was not too long ago that it wasn’t even used. Let’s take......
  • depressionaglassDepression Glass Antiques -> Decorative Arts -> Glass The history of Depression Glass is actually quite fascinating and it is a true testimony to its appeal that decades later it is still in high demand. These colorful glass items were made to be cheap, they had to be in order to sell......
  • Franklin Mint CollectiblesFranklin Mint Collectibles Collectibles -> Decorative Collectibles -> Franklin Mint One of the most popular brands of collectibles are Franklin Mint Collectibles. This company is well known throughout the world for providing collectible editions at reasonable prices and they even offer payment plans for their more expensive items. This has allowed thousands, if......
Online Stores If you liked this article, vote for it on del.icio.us and stumbleupon.


Categories:

Financial Security, Investing, Stocks, economy, stock market



Tags:

, , , , , , , , , , , , , , , , ,


2 comments ↓
#1 deden on 11.19.08 at 6:31 am

thanks for sharing your ideas. Really interesting. I wanna say thanks to my parents that they bought a book to me . The title is Rich Dad Poor Dad.

#2 edsklar on 11.19.08 at 7:53 am

Year End Tax Advantaged Strategies and Appreciation in Paradise

Join us for a Webinar on December 3

Space is limited.
Reserve your Webinar seat now at:
https://www2.gotomeeting.com/register/701165474

Costa Rica has one of the most appealing investment environments in the world. One of the reasons being, its tax system is much less complicated than the United States, Canada and Europe, offering great tax incentives for foreign investors, including tax free transactions. Such conditions, definitely contribute to Costa Rica’s real estate market boom.

This E-Seminar will discuss:

? New contributions for Retirement Plan
? Tax sheltered Investments in Costa Rica Real Estate
? Asset Protection in Costa Rica Real Estate
? Double Digit Appreciation in Costa Rica Real Estate
? Earn Tax Free profits on your real estate deals
? Own real estate in your IRA or other Qualified Retirement Plan
? Invest in what CNBC reported as historically having a 32% annual
return over the last decade with unbeatable downside protection

Panelist:

Michael Starkey, Vice President of Sales
Hacienda Matapalo

Who Should Attend:
Those with retirement funds seeking to improve their returns and their chances of achieving their
retirement goals.

All you need is a PC with standard Internet connection and a telephone.

Title: Year End Tax Advantaged Strategies and Appreciation in Paradise

Date: Wednesday, December 3, 2008

Time: 6:00 PM – 7:00 PM EST

After registering you will receive a confirmation email containing information about joining the Webinar.

System Requirements
PC-based attendees
Required: Windows® 2000, XP Home, XP Pro, 2003 Server, Vista

Macintosh®-based attendees
Required: Mac OS® X 10.4 (Tiger®) or newer

Leave a Comment

Email Updates

amount of money bad debt banks Budget cash money credit card credit card debt credit cards credit history creditors credit rating credit report credit score debts economy emergencies emergency fund enough money financial future frugal tips how much money insurance interest rate interest rates investments investors job lenders little bit living paycheck to paycheck loans Money money life multiple streams of income paycheck paycheck to paycheck Personal Finance premise retirement risk saving money savings account stock market Stocks streams of income