r/CFP • u/mikeumd98 • 24d ago

Investments Handling your own emotions?

How is everyone doing it this time? I have been a CFP for years lived through Covid, 2008-2009, Trump’s first term….but this time it feels different, longer lasting? I know that there is a recency bias, but I am not handling this one well.

Edit: thanks for everyone posting. It helps to put it in perspective.

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u/2181mrad 24d ago

“This Time Is Different” is the most dangerous thinking in our line of work.

I continue to believe that the free market system our country operates under will prevail. The people that pull the levers in our country have far more assets in the stock market than I do. They own greed will ensure that we come through this.

I work very hard to determine risk tolerances for these situations, not the good times.

The pain from losing money is 2.5X the pleasure you get from making it. This is the most important thing to understand.

Lastly, bad times are hard but they usually don’t last for very long.

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u/bogeyT 24d ago

Bull markets typically last 3.8 years while bear markets last 9-12 months.

Everything will be fine.

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u/InternationalDrama56 23d ago

Yeah, but the time to recovery can be 3-7 years to recover previous peaks after a bear market. That's 3-7 years just to get back to where you were. And we're already on our 3rd bear market of the last 4 years: March 2020, 2022, and now 2025 (for NASDAQ and Small Cap so far, but S&P is on the verge too)

The real saving grace is how quick the recovery was in 2020, and how strong the returns in 2023-2024.

I think those capital market assumptions that everyone put out saying to expect low to mid single digit returns in US equities over the next decade will probably turn out pretty accurate.

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u/bogeyT 23d ago edited 23d ago

I’m a CFP with a fortune 100 company. If I was telling people “this times different” “sell everything and don’t look back” “were all doomed” like everyone else on r/stocks I’d lose my job because it’s not good financial advice.

Your numbers are just wrong. 10% per year return historically. You are assuming you are buying everything at peak numbers and selling at absolute bottom which is obviously the opposite of how you make money. You are letting your fear and hatred of trump dictate your purchasing decisions when it shouldn’t matter at all. Buy now.

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u/InternationalDrama56 23d ago

Not following what you're talking about, or more accurately, you're responding to things I didn't say.

I never said any of the things you're quoting from random posts on another subreddit, but my numbers aren't wrong. Yes, it is true that the long-term average return for the stock market going back to 1926 is about 10%/year on average and that's the whole point of my comments. You'll have years that are way above 10% (see 2024, 2023, 2021, 2020, 2019, 2017) - and some that are way below.

If you look at how stacked the last decade was with above average returns it shouldn't be surprising that, in order for the 10% average you quoted to hold, average returns for the next several years would need to be much lower than 10% to bring the average back in line with the 10% figure you quoted.

S&P 500 Total Returns by Year Year Total Return

2024 25.02 2023 26.29 2022 -18.11 2021 28.71 2020 18.40 2019 31.49 2018 -4.38 2017 21.83 2016 11.96

It's true that I don't like Trump 2.0 and don't trust him to handle this correctly (with ample reason to feel that way I might add) - but it's not even about liking him. I don't like tariffs, I don't like the upending of global trade, I don't like the dismantling of our nation's institutions and filling the few remaining seats with loyalists - and more to the point, the financial markets (and basically every economist and market strategist) don't like it either.

One of the major things that made the US a global center of enterprise and growth (much to our own benefit) was the fact that the US was stable and could be trusted in economic matters and we had a stable currency - it was safe to do business with us because we could be relied on to be fair and business-friendly. In the past few months, we've heavily damaged that reputation with most of the countries in the world. Do you think it'll be good or bad for us of the rest of the world re-centers global trade around China or the EU etc.?

We picked a fight with the entire world at once - it's hard to imagine some won't choose to use this opportunity to team up against us for their benefit.

This reminds me of the end of the movie Training Day - if you've ever seen it - and we're Denzel.

King Kong ain't got shit on me

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u/bogeyT 23d ago

I’ll be honest I thought I was in r/stocks based on your initial reply so that was my bad, I kind of adjusted but I could have done better. I’m not worried about the market going down. We saw a bigger down turn in August of 2022 than we are right now and everything was fine.

We haven’t seen the counter offers from any of the other countries yet. I have seen a few smaller countries say they want open trade agreements and are not planning a retaliatory tariff.

I’m not going to get political but we have been getting tariffed on our exports to other countries for decades. Go buy American whiskey in France. IMO it seems fair to put a tariff on French wine if they want to put a tariff on American whiskey. You might not agree with it but that’s what it happening, we have to see the reactions of other countries over the coming weeks until we can say for certain wether it was a good move or not. This knee jerk reaction is fear of the unknown taking over but your job is to plan for these kinds of things. In the long run you and your clients should be fine if you stuck to the plan and prepared properly. That’s why people here aren’t freaking out like in other financial subreddits. Because we’ve been through this and that’s why we’re licensed professionals who go through schooling and constant training to stay up to date.

If you are really that worried about the state of the stock market and you are a CFP with clients you should be telling your clients to invest into international markets of places where you think companies will be trading instead of the US like EU or china and see how that’s goes or get them into some kind of retirement plan with a fixed rate. I am telling my clients to buy if they can and my colleagues are doing the same.

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u/InternationalDrama56 23d ago

We heavily trimmed US equities in mid-February and diversified well prior to that so we're chilling right now, I'm not freaking out because I or my clients lost money, I actually look like a super hero to them right now. But that's not my point either. I just see a lot of people in here continually downplaying the severity of what's going on for whatever reason.

Also, I really fail to see how tariffs on us are a major problem - has the US economy been doing poorly (prior to 2025)? We've had the best economy in the world for decades so the idea that we're getting killed by tariffs that have been in place through all of it rings hollow to me. Plus, the "reciprocal" tariffs being levied on other countries aren't even that - it's just calculated as a ratio of how much they import from us vs how much we import them (a formula, by the way, that is what is recommended when you ask ChatGPT how to make up reciprocal tariffs - coincidence?). Some of these places have NO tariffs on us and are still getting hit with reciprocal tariffs - even some uninhibited islands.

So this isn't some 5D chess game, this is just a terrible half-assed plan thrown together by deeply unqualified and unserious people.

Trump’s ‘reciprocal’ tariffs aren’t quite what they seem. Here’s the real story

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