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The words “Uncertainty” and “Unprecedented” have circulated news outlets more times throughout the past two years than possibly ever before. However, it’s important to note that the uncertainty we’re experiencing as a country today isn’t in theory higher than it was five or more years ago.READ THE ARTICLE
Measuring the unknown: According to what is called the “Policy Uncertainty Index”, which measures economic uncertainty amongst the media and forecasters, certainty about the future actually peaked twice in the past two decades: Once before September 11 and again in 2007 prior to the 2008 financial crisis. While these were undoubtedly uncertain periods of time, American complacency was high. The risks of the 9/11 attack and financial crisis were still there, but it wasn’t until they actually happened that we were more aware of the risk.
A greater awareness of the unexpected: While it might seem we’re experiencing more uncertainty this year, in reality, it comes down to the fact that complacency is low. As Morgan Housel states, “People are more aware that the future could go any way, that what’s prosperous today can evaporate tomorrow, and that predictions that seemed assured a few months ago can look crazy today.”
Make note: The uncertainty you might feel today could be a boon to your financial confidence. Times like these are always a benefit to our business, as our planning is based on the principles of planning for the best AND preparing for the worst.