Should You Change Your Investing Habits During Election Seasons?

[Music] brought to you by the every dooll app start budgeting for free today all right can we get some questions from our YouTube audience and uh here's a few that kind of ear in the same bucket and they are all around this sort of election season Politics the economy investing what do I do with my money so here's a few and we'll kind of pull back the curtain on these should we dial back on investing during a weak economy to have more cash on hand speaking from a lower middle class perspective that does own a home and currently no debt accept a car payment should we dial back investing yes I would dial back investing but not because of economic reasons it's because you have a car payment that's holding you back and you need to pay that off in case there's a weak economy I want you to owe no uh nobody anything so that's part of it but would I change my investing habits because of Any economic factors absolutely not I invest the same when the Market's doing great when the Market's doing poorly and you can call it dollar cost averaging which is a simple way to say you invest the same amount every month no matter what's happening those are the people that win Ken not the people who jump in and out as they feel the Market's going to do or it just did and I'm going to pull the money out put it back in those people always lose in the end well I want to call out what happened this week so uh we had a massive massive shakeup in the stock market on Monday of this week um and then here we are we're crawling back in fact I'll pull it up while we're talking but had you got out after the Thousand point you know loss it was over trillion dollars lost in one day had you gotten out you wouldn't be benefiting from you would have the recovery that's right and you would have got in too late so that's part of it you can pull up the numbers I'm going to move on to this next question which is related should I wait to invest more until after the election again what we've seen there's no history that shows us that if you invest the day after the election it's going to be a win and you shouldn't invest until then because we've hit many record highs I think we're going to see more record highs until the election there's going to be dips it's going to go up it's going to go down and so when you just invest no matter what you're going to see your rate of return be higher than those who jumped in and out and jumped in and out with this roller coaster by the way quick update the S&P as we sit right now has inched upward on Friday uh and uh it has almost reversed the weekly fall so the massive fall on Monday has almost been completely reversed within the span of a week yeah so just real evidence here straight out of the headlines it's unbelievable unbel should I wait to invest more until after the election no just invest more now and just keep investing and so how much when how does this work well if you're debt-free with an emergency fund invest 15% of your gross household income into retirement accounts that's how that works once you've got the house paid off you can invest as much as you'd like increase it to 20 30 40 50 60% if you'd like but again Dave Ramsey doesn't change his investing habits during election years or during Economic Times we know that invest invting in good times and bad when it's bad you're buying the stocks on sale you're buying these mutual funds at a discount when it's doing well well your money's growing for you with compound growth so I'm happy either way last question here where should we be investing right now since the market has taken a downturn the market the general overall US economy I believe in it still Ken uh the S&P 500 which represents the 500 largest companies that's where you're going to be putting your money and we have a split when we talk about mutual funds across four types you want to diversify them there's growth growth and income aggressive growth and international and that helps you sort of spread you know you don't want all your eggs in one basket and so when the US economy might not be doing well those international funds will probably help balance it out aggressive growth these are the wild children you don't know what they're going to do but you want that balance with some of the growth and income the old companies the Home Depot that have been around forever we know they're not going to Skyrocket but they're going to continue to grow at a a solid rate so that's how I do those four types of mutual funds that's in my 401k they're in Dave's 401k and so you can kind of see what funds that you have in your retirement accounts fall into those categories and if you need help reach out to a smartvestor pro ramsy solutions.com they can help with that create your free every dooll budget today the simplest way to budget for your life