Focus on What You Can Control: Financial Do’s and Don’ts During the Crisis

Our friends at Warren Averett Asset Management shared with us some Do’s and Don’ts for financially weathering the current situation we are all facing:



Dear Clients and Friends,

COVID-19 is not the first crisis we have endured, and it will likely not be the last. While we have not experienced the particular pain points of this virus all at one time before—like schools shutting down and grocery stores running low on items—we do have experience over the past several decades with some other pretty nasty events, including 1970’s energy crisis, 1980’s Black Monday, and 1990’s savings and loan crisis, along with the recession during the early part of that decade. Then we feared Y2K, the 2000-2002 Dot-com bubble, September 11,, 2001 and the Great Recession of 2008.

We have been through scary times before and have come out stronger on the other side. While past results are not indicative of future performance, we believe this situation will be no different. Of course, we will likely come out on the other side with a new “normal” just as we came out of 9/11 with new airline security rules. We can’t predict what changes will be made as a result of COVID-19, but we can look back together at the financial wisdom we have gained that applied to all of the crises mentioned above and apply them today.

You can see from the chart below that during previous crises, the market saw large drops in most decades. However, these drops typically lasted seven months, with an average drop of 36% off the S&P 500. Yes, stock prices are currently down, but history shows they should come back up again in time. We don’t pretend to know the future, but the chart below provides some historical wisdom for what returns have looked like after a bear market.


S&P 500 Total Returns from January 1926 – December 2019


We recommend spending time during this season focusing on what you can control. Below we have listed a few items to consider:


  • Do accumulate an emergency fund of cash that equals at least 3 months of living expenses if you do not have these funds set aside already. We recommend keeping these emergency funds in an easily accessible, liquid place. While protecting your emergency funds for as long as you can is ideal, keeping a small amount tucked away can help you sleep better at night. Times like these illustrate why cash is king during emotional uncertainty.
  • Do continue to save towards your financial goals, like making sure you are deferring into your 401k. Your dollars will go further in your retirement fund if you continue to contribute as you normally do.
  • Do evaluate your risk tolerance and decide whether you are taking the appropriate amount of risk (the percentage you invest in stocks vs. percentage you invest in bonds) in your investment accounts.
  • Do keep a long-term investment mindset. Leave your money invested, as this strategy will serve you better in the long-run than storing it under your mattress.
  • Do make sure you have the appropriate amounts and types of medical, life, disability, and long- term care insurance. These policies are a critical foundation of your financial plan.
  • Do have a will, power of attorney, and advance healthcare directive that reflects your current family and financial situation and that accomplish your goals and wishes.
  • Lastly, if you love someone, and I mean anyone (your family, your friends, or a partner of any kind) DO make sure you give intentional thought to the things listed above—and DO them!


  • Don’t invest money you will need in the next 1-3 years in the market. Set it aside in a more liquid account.
  • Don’t watch too much of the financial news. Bad news sells, so keep that in mind.
  • Don’t look at your account daily. We recommend monitoring periodically—either once a quarter or even once a year.
  • Don’t make emotional changes. Pick a strategy and stick to it.
  • Don’t stop saving for your goals. When the market goes down, you are buying more shares with your contributions as a result of the drop. This will help once the market recovers.


All of us are spending more time in the house right now. However, consider stepping away from your newsfeed for a while (that means your phone and the television). It will reduce your stress to balance the negative input from social media with positive input like family time, time outside in nice weather, a good book, or a funny movie. Remember, we are here to talk with you if you have questions or concerns. Reach out to us anytime. We’ll all get through this situation together.


Past performance may not be indicative of future results. To the extent that a reader has any questions regarding the applicability of any specific content to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. A copy of Warren Averett’s current written disclosure Brochure discussing our advisory services and fees is available upon request.

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