By Matt Hicks, Relationship Manager, AAFMAA Wealth Management & Trust (AWM&T)
2020 has been unpredictable and challenging for everyone. Political, social and health climate shifts have left the country in a permanent (well…we all hope it’s not permanent, right?) state of flux. When it comes to the financial markets, even some of the most unflappable investors have been shaken by extreme volatility, leaving many unsure of how to proceed. For military members and veterans, there is a silver lining: we are uniquely equipped to handle turbulent times. Once you’ve been professionally trained to face crises and life-threatening situations (regardless of branch of service), investing and planning for retirement in the face of a potential recession or market downturn doesn’t seem quite as daunting.
However, we can all still use a reminder of how to apply some of these best practices in the context of financial planning. In my own life and when I work with military clients, I like to focus on three key lessons from service that are well-suited for facing volatile markets and encourage long-term financial readiness.
In the Marine Corps, things change frequently and we must adapt to the changes. This is known as “Semper Gumby,” or always flexible. Each branch has its own version of this phrase and relies on it often to underscore a broader need to always be ready to adjust tactics on the fly. Employ this same ideology in your investing strategies and financial plans, which are subject to short- and long-term changes, mainly from shifts in your personal needs. Flexibility means always having a contingency plan – another well-known idiom from service is “no plan ever survives the first 30 seconds of contact.” To be confident and proactive with your personal finances, you must stay apprised of your situation and any internal or external factors that could require you to change course.
The most important aspect of the Semper Gumby concept is willingness to be flexible when uncertainty or volatility hits. A backup plan will do you no good if you get cold feet about putting it into action! When it comes to finances, emotions almost always get involved, so make sure that you’re not only sorting out logistics for backup plans, but you’re comfortable with enacting your plan and have discussed it with your spouse and family, if appropriate.
Remember Your Core Values and Goals
While contingency plans and flexibility are crucial to any financial strategy, so is staying on the course you have laid out. If you’ve talked with your family and any financial planners, you’ve probably laid out goals for your money as well as key principles you’d like to stick to when it comes to saving and investing – don’t let day-to-day noise change your philosophy! This is where experiences from your time in the military can come in handy again. When assigned a particular task or when setting out on a mission, you and your team knew exactly what the objectives were and worked in the face of any and all distractions or adversity to accomplish goals. Even if you had to alter your strategy to work around challenges, you still kept your eyes on the ultimate goal.
In your lifetime, you’ll likely see many shifts in financial markets and hear all sorts of advice on how to navigate volatile periods. It’s okay to take in this information, get informed and identify ways you might need to reassess your plan, just don’t make any snap decisions! History has shown us that over time, the markets make corrections and then continue to move upwards. Always keep your goals in mind and, if you feel like a particular strategy or change that’s being recommended or lauded by experts might take you off course, take a step back to consider the big picture before making any decisions.
Seek Help When You Need It
When faced with volatile markets and seemingly endless noise and advice, it helps to turn to a professional who can provide clarity. In the military, we know that we cannot do everything by ourselves, so we bring in other people or units to provide support to accomplish the mission. Of course personal finances and investment strategies tend to be less dangerous overall, but the same principle applies. You need to understand your limitations and be willing to turn to experts for help.
If you think you’re in over your head when it comes to building your financial plan, you aren’t sure if a new investment strategy is right for you or if you simply want a new perspective on how to best reach your goals, seek the help of a financial advisor. Even better, look for one who is military-friendly. There are many veterans now working as professionals working in financial services – a simple Google search can turn up ones in your area! Not only are these advisors knowledgeable in all things investing, saving and planning, you’ll be able to connect over shared experiences from your time in the military. They’ve been in your shoes before and can communicate plans and advice in a way that you’ll best understand. Make sure that any investment advisor or financial planner you work with is a fiduciary: they put your needs first!
Volatile markets and unprecedented events around the world have certainly kept us on our toes this year. However, service members and veterans have exactly what it takes to face these challenges and it’s easy to draw on basic principles instilled during service. Stay flexible, plan for anything and everything, keep an eye on your goals and trust the advice of others when you need it and you’ll be able to face any financial situation with confidence. $
Matt Hicks is a Relationship Manager with AAFMAA Wealth Management & Trust in Ridgefield, CT. He earned a BA in Political Science from Kenyon College. Prior to embarking on his financial markets career, Matthew served as Marine Corps Officer in the First Marine Division and is a veteran of combat operations in Desert Storm. He brings over 25 years of financial marketplace experience to AAFMAA Wealth Management & Trust and its clients.
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