Over the last few weeks, the stock market has jumped up and down like a yo-yo. Many readers have contacted me asking if I think they should make moves in their retirement account.
My answer is an almost automatic “no.”
Here’s why. Investing for retirement is a long term plan, one that’s based on sound logic and careful consideration. A good retirement investment plan understands and expects short term fluctuations in investments.
If you have a good retirement investing plan, then the stock market noise of the last few weeks is just that – noise. It doesn’t matter. In fact, it should scarcely raise an eyebrow. Why? The reality is that the day to day fluctuations in the stock market are not actionable news for almost all individual investors who aren’t incredibly wealthy.
The news on the day to day fluctuations of the stock market isn’t worth my time. That might seem to be a stunning thing to hear from a personal finance writer, but it’s true. The day to day bubbling of the stock market isn’t worth my time or attention.
I’m going to go a step further. Information that isn’t relevant enough or solid enough to genuinely inform me or cause me to take action isn’t worth my time.
Now, let’s break down what I mean by “genuinely informing me.” Anything that isn’t causing me to increase my understanding of an issue I already care about in the world, or isn’t alerting me to something that I actually need to take action on isn’t genuinely informing me. All of that stuff is just trivia or pure entertainment. I am not a more genuinely informed person from having read the headline news on most websites. All I’ve done is accumulate a bunch of trivia, none of which is actionable, none of which benefits my life, some of which is incorrect, and virtually all of which is incomplete.
None of that information helps me with my financial plans. None of that information brings me to a deeper understanding of any issue I care about. Virtually none of that information is going to lead me to take action. None of that information is well-researched and well-argued enough to ever make me change my mind. So what value does it actually have, aside from entertainment?
Frankly, it doesn’t have any lasting value, and if it’s just entertainment, there are a lot more entertaining things out there than the news headlines or angry talking heads on television.
For a long time, I persisted under the idea I needed to be “well informed on the issues of the day” in order to be able to have meaningful conversations with people. That just isn’t true. If someone starts talking about an issue and I don’t happen to know much about it, I can continue the conversation by just asking questions and authentically listening to the answers. That might nudge me to learn more about a particular issue in a deeper way, and it’ll certainly forge a better bond with that person, but it doesn’t require me to spend time reading information that doesn’t benefit my life or change my way of thinking.
One of my major resolutions for 2018 was to follow up on this concept and largely cut “junk information” and “headline news” out of my information diet aside from very specific niche areas that I know will be actionable for me. I’ve barely kept track of the latest thing the President has done or the latest celebrity comings and goings or the latest product unveilings. I have drastically cut my time spent on social media, mostly just using it as a tool to directly contact close friends and family members to set up face-to-face engagements.
And, honestly, I’m happier for it.
What have I done instead? I’ve read a number of books on philosophy and recent events/history and self-improvement and some fiction, too. I got more understanding out of what our military is doing from a book by Col. Andrew Bacevich than I got in a year of headline news. I’ve read some well-researched journalism and essays, some of which changed my thinking and others that led me to some action in my life. I watched a few movies for family movie night, cuddled up in the family room with my wife and the children around us. I haven’t turned on a cable news network this year and I’ve scarcely visited what one would call a “news” website, either.
I was a little worried about having conversations with people about the latest news, but I found that if I just ask some good questions and listen, the conversations go really well. People are always happy to share what they’ve learned and we find things to talk about.
Another interesting thing I’ve found is that my desire for new things has fallen off of a cliff. I am becoming steadily less and less interested in new products of all kinds, and that has led to a noticeable reduction in non-essential spending in January and an even bigger fall-off in February to this point. I just don’t have much interest in new stuff right now, and I think it’s due to a conscious shift in my media intake.
Perhaps most of all, I’ve found that I’m almost always better off waiting on a news story because the first reports are almost always highly inaccurate and missing a lot of key details. You almost always get a more well rounded view by waiting a month or two until a journalist has really investigated the issue from a bunch of angles and discovers that the truth is, most likely, somewhere between the overhyped news stories a month ago that were also lacking some key details. That kind of reporting influences my thinking in a rational way; the headline news does not.
So, how can this impact you? I’m going to propose a very simple thirty day challenge for you.
First, for thirty days, stop watching cable news and stop visiting news websites and cut back on your social media to the absolute bare minimum. Cut them all out of your media diet. This might seem hard at first, but trust me – there’s almost nothing actionable or deeply accurate to be found on any of those things. Just focus on not turning on the news for a while and not reading all of the opinions and rantings on social media.
Instead, devote just a little of your day to really learning about something you actually care about or building a skill you wish you had. You can do that in whatever form feels most comfortable to you. You can watch a documentary – for example, Netflix has the amazing Planet Earth II and a ton of Ken Burns documentaries. You can read a book on a topic you’ve always wanted to understand a little better, and read it slowly and take the time to really understand it. Or, you can simply experience something more deeply. Take some walks in the woods or around your town and look around carefully at the details. Listen to the birds sing and the changes going on around town. Engage in a personal hobby you care about with some extended focused time and try to go a little deeper than you’ve gone before – maybe that means playing a more challenging board game or taking on a really tough knitting project. You should have that extra “little bit of your day” available if you’re not looking at the news.
After thirty days, step back and ask how you feel about your life. Are you happier? I’m actually quite willing to bet that you will be. Do you actually understand something you didn’t understand before? Probably. Did you learn something that genuinely shapes your understanding of the world, or something you can take action on? Again, most likely.
Another thing I’ve done this year, which might be useful for you, is I stepped back and asked myself why I believed a lot of the things that I did. Why do I really think this way about that issue? I’ve been seeking answers for those questions, and along the way I’ve found, more than anything, is that other people, almost all of the time, are just acting in an honorable way in accordance with their principles, and that everyone has some human flaws but is usually genuinely trying to live up to the things they believe in. Usually, that “flaw” is getting caught up in a wave of emotion or reacting to a piece of shoddy journalism, which causes a sharper reaction than is probably necessary, but it comes from a place of principle and values.
When I was caught up in the hubbub of headline news, I didn’t give myself the chance to step back and appreciate this. It was easy to buy into the idea that a lot of people were either utterly unprincipled or corrupt, but that simply isn’t true. Almost everyone you meet out there has some values and principles that they really do hold dear and they’re trying their best to act on them and follow through on them.
Stepping back a little might just show you that others aren’t being negative or hateful, but that they really care about something that really matters to them and they’re merely clumsy with their words. That kind of appreciation can salvage a friendship or a professional relationship, and that shift can have an incredible positive impact on your personal and professional life.
So, here are the benefits I’ve found from simply cutting back on the headline news and focusing more on more thoughtful media and experiences to replace it.
One, I’m less emotionally fraught about the state of the world. I just don’t feel as worried as I once was about things. There are too many good things going on that you don’t see if you look constantly at the headlines. Stepping back from the news flow enables you to look around and see a lot of good things going on, like a beautiful sunny morning and a successful park cleanup project and the fixing of a strained relationship.
Two, I’m less motivated to buy new things. I’m less aware of them in general, and I’m far less emotionally motivated to buy anything. I just don’t see the need, and I attribute that to less input from social media and headline news.
Three, I feel like I have a better understanding of several things I care about. There are quite a few issues that I’ve struggled to understand in the modern world and the headlines certainly weren’t helping in that regard. Stepping back and actually making a concerted effort to understand those things has actually helped me shape my worldview and understand the world a little better.
Four, I feel like I have a deeper appreciation of other people, even those who have different perspectives than me. Most people are genuinely good people, who sometimes believe very strongly and deeply about worthwhile things and allow that emotion to sometimes guide them to less kind words than they should be using. When you’re also caught up on the emotional wave of the headlines, it can be really hard to see that, especially of people you don’t immediately fully agree with.
Finally, I feel almost no need to make impulsive financial decisions. I don’t feel the need to impulsively buy things. I don’t feel the need to make big changes to my investments. I’m not worried about the ups and downs of the stock market at all. I have no desire at all to make any major spur-of-the-moment decisions that will impact my finances. That can only be a huge benefit for my financial life.
Give a better media diet a shot for a while. It might help more than you think.
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