Every Retirement Plan Can Benefit From a Fresh PerspectiveWhen you make the commitment of marriage, you already understand that it means forever. Once you
already have your own family, you will be flooded by the many things which you did not understand back
when you were young. You begin to care a lot more for your family that yourself. You work hard, strive more and begin accepting challenges just to make your family proud and contented.
Indeed a family means a lot to everyone. Even those who claim that they are not sentimental will melt like
candle when their family is on topic. Who wouldn't? Families are the basic unit of our society and they are
the ones whom we have spent a lot of our time~ Given this reality, we know that almost all that we are doing
are centered towards giving our families a better life. However, it seems like nowadays, we are racing with
time. We do not know when we will die and apparently, none can predict that too. This is the main
hindrance to the plans that we have made for our families.
This is the reason why life insurances were created or formulated. It's not just a business which a few
people enjoy. It's a policy that has made immortal love possible. What then is life insurance? Could it be
equated to a savings in a bank?
Every Retirement Plan Can Benefit From a Fresh PerspectiveRational Behavior
1. Buy in a declining market to take advantage of lower prices
2. STAY invested... Take the long view and continue contributions while riding out
market ups and downs.
3. Sell or rebalance when the market is rising to lock in gains
1. Sell low: Locks in your losses
2. Cash out: Wait until it is 'safe' to re-enter the market after it has recovered
3. Buy high: Get back into the market once share prices are rising
Overreaction, herd mentality and over confidence drives Irrational Behavior. For instance,
responding in the extreme to the latest market noise, causes erratic swings in your investment
decisions. Following the 'crowd', after all, how can everyone be wrong? Believing in your
ability to 'time the market'
Ideas to combat Irrational behavior
1. Have discipline to maintain your long term strategy, regardless of the market noise
2. Have a well diversified portfolio
3. Have assets allocated based on your time horizon and risk tolerance
Remember, it is always a good idea to analyze your investment performance as it relates to
your risk tolerance. Tweaking your investment choices periodically can make a huge difference
in your returns by eliminating poor performing investments.