Peace in times of trouble

Woodbury Bulletin - 10/22/2008

When I called my parents this past weekend, my 75-year-old father sounded very upset. And I can understand why.

Both of my parents have lived frugally through their whole life, first out of necessity, later more out of habit. They lived below their means and saved as much as they could.

A few years ago, my brother took my parents’ money and invested it in the stock market, with the good intention to make some more money for them.

For several years, the interest rate kept falling and the stock market went up like crazy in China. Everyone wanted to get in the market and no one wanted to be left out of the easy money making game. It didn’t make sense to have money sitting in the bank and lose value.

Now with the stock market crash in China and around the world, my parents lost a lot of their savings. They didn’t even know how much was lost. My brother didn’t want to tell them.

I feel sorry for my parents and for their loss. It was their hard-earned money and their life savings. My parents know nothing about investing and just wanted safety with their money.

But I don’t blame my brother for what he did. He had good intentions. I just wish he had listened to my father when father asked him to take the money out when the market was doing well.

I offered my father a few words of comfort.

“Everyone is losing money in this market meltdown worldwide. If you leave the money in the market, it will come back some day. If you need money for living, I will certainly help you out whenever I can.”

Knowing my father’s personality, I doubt that my words could ease his anxiety and reduce his high blood pressure.

I wish my father could feel the calm and peace that I have.

Over 10 years ago, to be more self-dependent, I learned about personal finance and investing. I started to invest in my retirement account through my employer, later when I had kids, also in their college savings accounts.

So, over the years I have accumulated some money in various accounts. Like everyone else, my accounts went down in the recent weeks. But the market meltdown has not bothered me. I have not checked how much I have lost.

And I have certainly not lost any sleep over it. That’s because I know something my father does not know and we are in different life-stages, too.

Here is what I know that keeps me calm and in peace.

I know investing is for the long term. When I first learned about investing, I used to check the stock market quotes in the newspaper to find out how my mutual funds were doing. Then I stopped doing that.

Why should I waste my time and care about the short term performance of the market?

I know investing has risks. The stock market goes up and down. It doesn’t just go one way.

I know the advantage of dollar-cost averaging to reduce risk. When the market goes down, the same amount I allocate to invest can buy more shares.

I know the rule to buy low and sell high. This is not a time to panic or to sell. It is actually a good time to buy.

I know not to follow the crowd, in investing as well as in life. I don’t want to do something because everyone else is doing it.

If something is very hot and popular in the market, then it’s time to be cautious. It is likely too late to follow.

Most of all, I know I am a child of God and I am in His hands.

No matter what happens in the stock market and in life, no matter how much money I have or lose, I will be fine.

Because He is the rock on which I stand, everything else can be sinking sand. I know it is better to surrender than to worry.

Had my father known all that I know, I think he would not be as upset and anxious as he is now.

Please help me pray for my father and everyone else in difficult financial situations for peace and serenity in this time of trouble.

Let us remember the “Serenity Prayer” by Reinhold Niebuhr: “God grant me the serenity to accept the things I cannot change, courage to change the things I can, and the wisdom to know the difference.”