Planning, whether you are discussing life, business, relationships, your future, a vacation, the purchase of a home, can be straightforward. In its most basic form, it is determining what you want, why you want it, and then determining how you will go about getting it.
Speaking of the markets, and how they relate to the financial side of life, any number of prognosticators have offered their observations about the market's 2008 performance, or lack thereof. The question is whether and how the market's performance had an impact, good or bad, on your ability to live out the future you have chosen for yourself.
The presuppositions here are that you have invested time in determining what your future looks like, and that you believe you have a choice. If you believe you have no choice regarding your future, then there is no reason to make plans to create that picture in your mind.
If you believe you have a choice, and have made no plans, perhaps making those plans isn't important to you. While not an option I'd choose, it is certainly an option that is open to you.
If you believe you have a choice, and have made plans for the future, my guess is that the important questions don't really concern market performance, or event how your financial statement or investments fared. The real question is whether, as a result of what has happened, you will need to change your plans.
If you have achieved financial independence, will you need to alter your lifestyle? If you are working your way toward financial independence, will you need to change the target date, or the amount of money you are setting aside, or both? These are the material questions, and ones you probably want to answer.
Market performance only matters in the context of how it helps you, or keeps from helping you, reach your goals, and live out the future you have pictured in your mind.
Until next week...
Randy
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