Three Tips for Managing Your Money in These Scary Times

Jeevan Sivasubramaniam Posted by Jeevan Sivasubramaniam, Managing Director, Editorial, Berrett-Koehler Publishers Inc.



Chris Peck is a financial advisor with Natural Investments, LLC and one of the authors of The Resilient Investor. Chris recognizes that these are scary times politically and the political can often impact the financial. Given that the economy may not be the most stable at this time, he put together these three tips for how best to manage your money in these wacky times:

For many of us November 9th was a through-the-looking-glass moment. We hadn’t considered the possibility, hadn’t thought about what we would do, didn’t consider the impact on our families, businesses, money. I kept thinking “the adults in the room will step up.” What a piece of fantastical nonsense. Our fears are in sharp relief: authoritarianism rising, ignorance comforted, culture lurching, families divided. Our most vulnerable populations are in danger, the robots are coming, the RUSSIANS are coming. And the climate is still changing. Yes, I’m scared. What do we do? Specifically, what do we do with our money? Do we run for the hills? Pass for conservatives and double down on ExxonMobil? Head to the beach and go full ostrich? My advice: none of the above; instead, do the following.

1. Live on less. When your expenses are high, financial well-being is elusive. Just like it’s very difficult to out-exercise a bad diet, it’s hard to out earn excessive spending. Anyone can live on 50% of their income. There are people living at every income level in your community. Mimic the spending of someone at half your income level and surprise, life is still good. Eliminate recurring expenses for things you just don’t use, get out of debt as fast as you can, and look to simplify. “Cash is king” isn’t a medieval money hack, it reduces fear, creates options, and helps you thrive. Go full cheapskate and invest the rest.

2. Invest in self care. This does not contradict the previous point. Taking a hike, doing yoga, turning off screens, it all helps, and it’s all free. At least one screen-and-social-media-free day a week seems to be critical for mental health. Of course you can check texts to coordinate plans, but give yourself a break. Slow down and step back from the frenzy. Connect with community. Read a physical, paper book checked out from the library. It feels good. Exercise helps everything, it especially reduces anxiety and fear.

3. Don’t fixate on a future scenario. As Mark Twain once said, “I've had a lot of worries in my life, most of which never happened.” If 2016 taught us anything, we don’t know what the future will bring. When the roller coaster is climbing upward it looks like we’re about to shoot out into the sky, when it’s hurtling down we think we’re crashing into the ground. Neither happen of course. Don’t get locked into projecting today’s drama onto next year, good or bad. Stay centered in a longer-term vision, don’t try to time the market, and please, think for yourself. Think about the news. Think about the trends. Think about your purpose.