March Madness is here, and with it comes the excitement of watching underdogs make improbable runs and upsets that no one saw coming. It’s fun to fill out a bracket, root for a Cinderella story, and watch the chaos unfold.
But when it comes to investing, that same mindset can be dangerous.
The Appeal of Long Shots
In basketball, betting on a 15 seed to beat a 2 seed is entertaining. The worst that happens is your bracket gets busted. But in investing, chasing long shots, hot stocks, or trying to time the market can have real consequences for your financial security.
We’re seeing a lot of volatility in the markets right now, especially after several strong years. When markets swing, it’s tempting to make moves, trying to get out before things drop or jump back in when they recover. But that approach rarely works in your favor.
What Works: Consistency Over Timing
The difference between a successful retirement strategy and a busted one often comes down to consistency. Building a long-term plan, sticking to your goals, and maintaining your investment strategy through ups and downs is what gets results.
This is especially true for workplace retirement savings like 401(k) and 403(b) plans. These accounts are designed for long-term growth, not short-term trading or marketing timing. The market will always have periods unpredictability, but your response to it shouldn’t be unpredictable… instead it should be strategic and grounded in our financial goals and risk profile.
March Madness is a great reminder that unpredictability makes for exciting basketball, but when it comes to your financial picture, consistency, discipline, and strategy win every time.
Reach out to our team with questions, or if there’s more we can do to help.
Video Transcript
It’s March, the weather’s starting to get a little bit better, a little bit warmer, but most importantly, it is March Madness NCAA basketball season. I love the excitement, the unpredictability, the upsets, the underdog stories, and the thrill of the tournament for these teams that have worked so hard all year.
But when it comes to our financial lives and our overall financial retirement plans, unpredictability happens. But it shouldn’t derail us. It shouldn’t set us off course.
Chasing that ten seed or 15 seed making a deep run into the tournament is fun when it comes to basketball. Chasing a hot stock, trying to time the ups and downs of the market, not being prepared for an unexpected financial challenge or expense—those are not such great unpredictability when it comes to our financial picture.
We’re seeing a lot of volatility in the markets, especially coming off of several good years. So it’s a great reminder that the thrill of a long shot in college basketball is awesome, but when it comes to our financial picture, building and developing a strategic plan, sticking to those goals, sticking to a long term investment strategy, especially for savings like 401(k) and 403(b) retirement savings, as opposed to trying to get in and out of the market, generally is the way to go.
