Hey friends, hope you are enjoying the nice weather and getting excited for summer.

Today we are sharing a brilliant response from a reader to a past topic, and further onto how markets have seemingly turned on a dime and hopefully you stayed the course through all the drama.

Have a great weekend,

Eddie

PS. Know someone who’d enjoy this? Send it their way.

Personal Finance

Couple weeks ago I wrote about the Psychology of Spending, you can read it here Issue #66.

It followed with many great responses, but this one in particular stood out for me:

“Interesting regarding the need versus want metal aspect of things and how that evolves. I keep myself in great shape for a 39 year old (Top 1% as per blood work), and NOW every time when I go to the grocery store and buy my food, I see it as an investment in my health and I don't stinge on the higher quality items. Spending $ on this type of shit used to drive me crazy IE always looking for the cheap shite to satisfy... Now I'll spend the extra $4 on a grass fed steak and get irritated when I have to choose the cheaper version. I used to drive a BMW M3 and eat cheap cuts, now I drive a vintage Mercedes and only eat grass fed.”

Slow clap, Connor. Nailed it.

Makes me wonder, where else are we feeding the ego unnecessarily?

Stock Markets

It’s amazing how quickly sentiment turns.

Look at these headlines on April 7th, one month ago:

A novice investor may have read those headlines after the SP500 had fallen 18.55% since the January highs and decided to sell all their stocks out of fear of markets going down further.

Equally so an experienced yet emotional investor could easily have done the same thing, and I know some that did.

But guess what, markets are one small change in the tea leaves away from turning on a dime. Just when the pain was getting unbearable, down nearly 20%, and the dire headlines that came with it, the SP500 is up 15% since then.

I personally continued to add to my index funds during the stock market rout.

Even though it felt scary, I knew it was the right thing to do. Since I had a plan to do so in advance, it took almost all the emotion out of the purchase decisions as I added more shares to my portfolio while stocks were down. I will keep adding as stocks advance, too.

While amusing to discuss with others in conversation, irrelevant was—and always will be—the short term price of the market.

Just buy more shares…that’s the whole point. Portfolio Value = Price x Shares. Increase the latter, the former will do it’s job through time.

For those of you that did the same, congratulations.

And for those that didn’t and let fear get the best of them, that’s ok, take it as a learning lesson for the next bear market.

There will be lots of them.

I talk about this kind of long-term mindset in my investing course—it's built for people who want to stop guessing and start building real wealth with ETFs. If that’s you, check it out here. (P.S. Subscribers get 10% off with code SIMPLYINVEST)

1 Quote

“I used to drive a BMW M3 and eat cheap cuts, now I drive a vintage Mercedes and only eat grass fed”

Connor, reader of the Journal since June 2024.

A Question

First question: now that the stock market has recovered, how do you feel about it?

Second: what are you going to do about it?

——

Thank you,

Eddie Gudewill

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