Stay the Course Amid Uncertain Times

So much uncertainty being felt in the U.S. and around the globe surrounding a number of different issues, but especially right now with the spread of COVID-19. This is first and foremost upsetting from a human perspective, but then its exacerbated when we watch how the financial markets respond and see our retirement accounts lose so much ground.

At Maxima Wealth Management, it is a fundamental principle that markets are developed to contend with uncertainty, reacting in real-time as it sorts out and responds to all available information. Believe it or not, the recent declines actually demonstrate a functioning market.

While the markets are reacting to all new information as it continues to become available it is also pricing in possible unknowns. During increased uncertainty the risk associated is also heightened. This leads to an increase in returns that investors demand to assume that risk, which drives prices down.

No one can tell you exactly when the markets will turn around or by how much. We do know based on three similar historical events (SARS, Ebola, H1N1) strong evidence shows that markets rebounded quickly and decisively.1

As illustrated in the video link by Dimensional Fund Advisors below, what’s important is “Tuning Out the Noise” and don’t lose sight of your long-term investment plan. This is a time you may recognize the value of your financial advisor.


A trusted financial advisor will work with you to establish your personal investment plan that incorporates your personal risk tolerance and time horizon. Implementing this will create a portfolio allocated in a manner that is comfortable for you, with the understanding that uncertainty is a part of investing and the need to stay the course may ultimately lead to a more pleasant and beneficial investment experience.

At Maxima Wealth Management we assist our clients in developing a plan that meets their individual needs, we offer a structured, unemotional and highly diversified investment approach addressing risk management and helping you stay the course.

To learn more about how we can help you, contact us today for a consultation!


Exercising Financial Mindfulness and Its Impact on Your Investments

As a financial planner I practice planning for the future, so incorporating the concept of financial mindfulness might seem counterintuitive but I believe there’s a place for it.

As a reminder, from my Blog, Six Suggested Tips to Reduce Holiday Stress through Mindfulness, I referred to Psychology Today’s definition of mindfulness as “a state of active, open attention on the present. When you’re mindful, you observe your thoughts and feelings from a distance, without judging them good or bad. Mindfulness means living in the moment”.

So, the question is how do we apply this concept to financial planning? After some research and education, what I learned is that my practice of financial planning actually leads to my clients’ financial mindfulness. Our process allows my clients to make wealth building decisions based on expectations for the long-term gain rather than worrying about short-term loss.

3 Basic Concepts of Mindfulness Applied to Investing

In addition to having a financial plan, financial mindfulness can be enriched by training your mind to make better financial decisions. Below I discuss 3 concepts applied to 3 conditions that can cause problems, whether it be with your financial future or a 3-day vacation to Vegas. I propose that exercising basic concepts of mindfulness can help you avoid such traps.

1. Perspective

We know from my Blog, Behavior Finance: Does Fear and Emotion Drive Financial Behavior, that Prospect Theory and others can lead to irrational investment decisions. Prospect Theory believes that people value gains more positively than they value losses negatively, and therefore make decisions based on these perceptions.

Applying the concept of perspective and looking at the big picture can help with how we view losses in our portfolio values from one day to another. We know that historically the market has made long-term gains despite periods of volatility. A portfolio’s asset allocation determines its exposure to risk factors, how to allocate is one of the most important factors in achieving successful investment results as well as mitigate losses. At Maxima Wealth Management, I spend a significant amount of time analyzing and determining the appropriate asset allocation plan based on your personal risk factor tolerance.      

2. Gratitude

In today’s 24-hour news cycle, constant knowledge of what’s happening in the world – typically negative news – can exacerbate decision making. Making financial decisions while stressed could lead to irrational decisions or no decisions at all.

As your financial adviser, it’s my job to be your filter and keep you focused on what’s important to your plan. Mindfulness teaches us to make a note of what we are grateful for a concept that helps with reducing anxiety and re-focus on our goals. Follow this link and read the six tips to reduce stress.

3. Balance

Short-term needs and long-term goals, how do you do both? Financial goal setting requires that you focus on today so that you can have what you want in the future. Goals will drive your moment by moment decisions and help create your Investment Plan.

Once you have developed and implemented a plan, it is important to review the plan periodically. It makes good sense to review your plan and to reassess your situation at least on an annual basis. This will keep you on track to meet your goals while keeping you focused on your short-term decisions.

I hope now you can agree there’s value in financial mindfulness. Remember keep things in perspective, be grateful and above all, strive for balance, one of the greatest gifts of mindfulness. You are in control and can begin the process of retraining yourself to a state of financial mindfulness.

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Six Suggested Tips to Reduce Holiday Stress through Mindfulness

The holiday season is a time to enjoy special time with family and friends, eat tasty food, show our love and appreciation through gifts and celebrate our faith. However, for some it can be the most stressful time of the year.

My blogs for the month of December address holiday season stress and financial stress through a concept now referred to as Mindfulness. This concept was introduced to me many years ago; however, more recently it was presented to me and I paid attention while attending an Air Force conference. Since the conference, I have worked on utilizing Mindfulness in my own life and I really wanted to share it with my blog readers.

What is Mindfulness?

Psychology Today defines mindfulness as “a state of active, open attention on the present. When you’re mindful, you observe your thoughts and feelings from a distance, without judging them good or bad. Mindfulness means living in the moment”.

Six Suggested Tips

I offer the following tips that you can apply not only during the holiday season – a time that can be very stressful to some, but also throughout your life. If you are facing times of high anxiety (good or bad) it can be difficult to focus your attention on the present and appreciate everything and everyone. These tips can help you with being mindful.

1. Live in the moment and be present

My experience has shown me that most stress is the result of anxiety about the future or being preoccupied with the past. By just focusing on the present, your mind naturally calms down and your anxiety is reduced. I know at certain times in our lives, especially holiday season, this is not as easy as it sounds. However, every once in a while, if you pledge to yourself to redirect your attention from thinking and pay attention to what is happening at that moment you can begin to retrain yourself to be present.

2. Eat some chocolate and/or go for a short walk

Another tip on your way to mindfulness is a brief walk. Walking is an immediate stress reliever and mood booster. While on your walk take in the sights, appreciate the sounds and smells. Don’t rush it and try to focus on your awareness of your walk.

Chocolate Taste-Wheel

Did you know that chocolate has a wide range of flavors? When you eat it do you take time to really taste the flavors and smell the aromas? At this time of year there are so many different kinds of food to enjoy and it’s so easy to eat too much, too fast and then not even notice all the wonderful flavors. I challenge you to treat yourself to some chocolate. But, eat it and take the time to enjoy it. Try to figure out the flavors. Below is a “chocolate wheel” that shows you the many flavors.

3. On one hand count what you are grateful for

Once a day think of 5 things (1 for each finger, thumb) that you are grateful for. The first 3 or 4 may be easy, but thinking of that last one can sometimes become challenging. This is okay as the exercise is prompting you to be aware and notice the small things in life.

4. Be willing to ask for help

This can be done by simply asking each person coming to your holiday event to bring a dish to share. Or maybe you were assigned to bring cookies to the office potluck. If you don’t have the time to bake them, buy them. These events are more enjoyable if you can take the time to appreciate the festivities and enjoy spending time with family/friends.

5. Be kind and gentle/have compassion – both for yourself and others

The holiday season can trigger a variety of emotions for many people and not all are happy. Unfortunately, the holidays can be reminders of loss, grief or loneliness. It’s important to acknowledge whatever emotions you have versus ignoring them.

Make sure you don’t forget to take care of yourself. Get a good night’s sleep, exercise, relax and have fun. This will help you recharge and be more attentive to others making the holidays more enjoyable for everyone.

6. Balance the “should” with awareness of your own needs and expand how you communicate care

Be careful to recognize your needs and balance them with trying to please everyone’s expectations. It’s great if you enjoy planning the perfect dinner or getting the perfect gift, but make sure to appreciate how it affects you. Don’t forget that you deserve to enjoy the holiday too, but it’s your responsibility to make that happen.

The holiday season for most cultures entails gift-giving. But gift-giving and showing you care can be accomplished in a number of ways. You can explore how you show you care by answering the following questions before buying something:

  1. What are you trying to communicate with the gift?
  2. Are there other ways to show your feelings, i.e. spend quality time, express your feelings directly, or do something nice/supportive?

Above all, remember to be present, no matter how busy you get. You control your own happiness and can begin the process of retraining yourself to a state of mindfulness. Happy Holidays!

My next blog will explore the concept of Financial Mindfulness. Be sure to sign up for an email version of my blogs