Last week, I was out running errands and listening to the local news station on the radio. The 60 second financial segment came on, and they were talking about the volatility of the S&P and how the month of September had ended with “significant” losses.
I get it, it’s the news, and we all know their main goal is to sensationalize EVERYTHING.
Here’s the part that burns me.
The reporter goes on to make a comment, and I’m paraphrasing, about near retirees and how this will seriously impact their ability to retire.
And not just for near retirees, but comments along the lines of, “investors saw their 401(k)’s take a huge hit last month”.
What?!?!
In my not so humble opinion, this is reckless reporting of the “facts”. It’s sensationalism and exaggeration and although it is FACT that the S&P saw a decline in September, it leaves out other very important FACTS, and sends anxious listeners into a panic.
Here are two key facts, one which was reported, the other which was not.
The S&P finished the month of September “down” by 4.7%.
Listeners definitely got the gist of that message, and then some.
Here’s what was NOT reported:
The S&P is UP 16% year to date through 10/11/21 (see lovely trend line in graph below).
Yes, that’s right, your 401(k) may have seen a decline in September, but I will bet the bank that if you have a well-diversified portfolio of investments, you still have more now than you did in January.
Heck, even if you only own the S&P index, you can see above that you are definitely up for the year.
I’ll leave you with two final thoughts that I know I’ve touted before:
Growing your wealth is not about one month of returns, positive or negative. You are in it for the long game. This means consistent and diversified savings of your earnings over time. DO NOT PANIC.
The stock market is always going to have up and down DAYS, MONTHS and YEARS.
Always has…always will. And that’s a fact!
My Favorite Quotes
“A goal without a plan is just a wish”