The Stonk Market jordanmarsh6, April 14, 2021April 5, 2023 I have already mentioned before how my dad is a financial advisor. He does a lot of teaching as a big part of what he does. He taught as an adjunct professor at BYU to both students and faculty about personal finance. Growing up I heard him speak so often, that I have no excuse to not have learned his material. As a funny side note, I took his class as a freshman in BYU and got an A-. What makes matters worse is my older brother also took his class as a freshman in college and got the highest grade in the class. So yeah that’s a thing. Anyways, as I have been pondering on the idea of playing the long game in improving our habits, I had yet another financial analogy come to mind. If you’re not aware of what a financial advisor does, here’s a very brief idea: people give you money, you invest their money in the market in the places you think it will do the best, and you hopefully get them a good return on their investment. Then you as the financial advisor bill a small percentage of the entire amount of money they have with you. As you can imagine, when the market is good, clients are happy. And they are especially happy when you as the advisor can show them that your investments beat the overall market. However, as you can probably also imagine, when the market is not good then it can be pretty messy. It’s like clockwork. My dad says that he has the five or so clients call every time the market hits a downturn panicking. Understandably, they don’t want to lose their money. But every time, my dad shows them this graph. This shows the Dow Jones Industrial average over the last 100 years. If you’re not familiar, the Dow follows the stock performance of the thirty top companies in the U.S. It’s a basic barometer for the overall health of the market. What do you notice about that graph? And why would my dad want to show that the panicked clients when they are in the midst of an economic downturn? It sure looks like a roller coaster of a ride, but on the whole it keeps steadily climbing. People think the market is so volatile and unpredictable, but it actually can be fairly reliable if considered over the long term. As we plan to improve ourselves, we need to plan for the metaphorical economic downturns. It is a bonafide fact that we will lose motivation from time to time, we’ll let other interests supersede, and that we won’t perfectly execute our plan. I’ve harped on this idea for the past couple of posts, only because I feel like there is so much to say about it. The stock market over the last 100 years has been good for a net positive 10% return from year to year. Obviously, that wildly fluctuates in the short term but is fairly steady in the long term. I want the same to be said about our habits. Self Improvement