Big Feelings, Small Body… And some investment stuff too…

As a dad to a toddler, working on building the best financial advice business in the UK, whilst also studying to become Chartered, trying to maintain healthy relationships and retain some degree of sanity without falling over, it’s fair to say that sometimes right now…Life feels pretty damn busy!

I’ve started to navigate some pretty good structures in my life to maximise the efficiency of my time and, where possible, combine a couple of things together. That isn’t unique I know, but it is definitely a shift from my previous lifestyle of chaos.

One such example this week was picking the baby up from nursery so we could have a couple of hours together before Mrs S got home from work.

I decided I’d get a head start on dinner, but that also meant we needed to do some shopping, so off we trotted to Aldi for the weekly shop.

On the route round, I made the rookie mistake of not letting the little one push the trolley as soon as we went through the door. And anyone who has had any interaction with somebody approaching two will testify that they have BIG feelings in very small bodies and it takes the smallest thing to ruin their day…

So, lo and behold.

Meltdown central.

And we had a really good one this time...Proper meltdown.

Head thrashing, arms spinning, screaming like nobody else was around type meltdown.

And it’s fair to say it was pretty embarrassing.

Or at least, it could have been if people weren’t actually so understanding.

Now, the mental acrobatics of making this from a dad doing his best, with an irrational toddler, in the midst of a meltdown to a Linkedin learning piece may be abit cringe…

But I do actually think this one works.

Somewhere along the line there was a small blip.

I didn’t hand over the trolley, which she isn’t even big enough to actually push...

That relatively small event then turned into a fairly major downturn in behaviour.

And actually, that isn’t totally dissimilar to what can happen with investments!

Something happens in the world…

Markets react.

People react to the markets reacting.

The news gets louder.

Before you know it, what started as one event can feel like everything has gone completely wrong.

Now, the irrational part of my brain in Aldi could have stopped what I was doing, abandoned the shopping, ran out of the shop and tried desperately to rationalise with somebody who, at that particular moment, was being completely irrational.

Or

the slightly more level-headed version of me, which thankfully happens to be me most of the time when she behaves this way, could just carry on as normal.

So, after making sure she was physically okay and it was legitimately a toddler tantrum rather than me unknowingly ramming her with the trolley...

WE KEEP GOING.

And before I knew it, the meltdown had stopped.

We were back to cuddles, holding hands and an angelic toddler happily waving at everybody as we walked around.

Nothing material had really changed.

We had just moved through it.

And that’s probably the bit that got me thinking.

When markets start falling, our instinct can be exactly the same.

Something feels wrong, therefore we need to do something.

Sell.

Move everything to cash.

Change investments.

Stop contributing.

Anything that gives us the feeling that we’ve taken back some control.

But sometimes the worst thing we can do in the middle of something irrational is make another irrational decision ourselves.

That doesn’t mean markets always immediately bounce back, and it certainly doesn’t mean every investment works out exactly as planned.

But periods of volatility are part of investing.

Markets fall.

Markets recover.

Then, at some point, they fall again.

The important part is making sure the financial plan around the investment is strong enough that you don’t need to panic every time they do.

And this is where effective financial planning really earns its keep. Being a voice of council to discuss your needs, concerns and wants. To review are you being rational in your decisions or are you having an irrational emotional response to something you’ll have likely lived through before but at this moment feels like you have no control over? Much like the toddlers big emotions with something out of their control.

Having cash available for the things you know are coming. Could be sensible.

Not investing money you’re likely to need in the short term. Could be sensible.

Having the right protection in place. Could be sensible.

Moving every penny you earn into a cash account because the markets dipped. Probably had better ideas in life…

Like making sure your investments actually reflect how much risk you can afford, and emotionally tolerate, when things don’t look particularly pretty.

Essentially, having the financial equivalent of the emergency milk bottle ready when the meltdown gets a little bit too much.

For everything else?

Sometimes you just have to ride the wave.

Because ten minutes later you might be holding hands, getting cuddles and wondering what all the fuss was about in the first place.

Although next time we go to Aldi, I’ll probably just give her a basket... Maybe.

This article is for informational and educational purposes only and does not constitute personal financial advice. The value of investments, and any income derived from them, can go down as well as up, and you may get back less than you invest. Past performance is not a reliable indicator of future results. Always seek professional advice tailored to your individual circumstances before making financial decisions.