Investing Worries? Avoid Panic Selling and Keep a Long-Term Perspective

admin • May 15, 2023

Investing is a key strategy when it comes to building wealth over the long term. But as important as it is, a lot of people find it intimidating. Investing isn’t risk-free, which can often create worries for our clients—especially during an economic downturn.

If you keep a close eye on your individual investment accounts, you know why. During economic downturns, you might see the value of your portfolio plummet. And it can be terrifying. 

When this happens, many people have the urge to make an emotional—not logical—decision and sell their investments. But this is a big mistake.

If you’re tempted to abandon your investments as soon as the economy starts to look dicey, pause and take a deep breath. Below we’ll show you why panic selling is a bad idea—and how approaching your investments with a long-term, level-headed approach can help you build more wealth over the years. 

Emotional Decision-Making Doesn’t Work for Your Investments

Money is emotional. Anyone who’s ever felt a sense of guilt or pleasure when spending money knows this. When it comes to spending, your emotions can help you make financial decisions in line with your values. But when it comes to investing , these types of decisions can quickly derail your financial strategy. When investing long-term, you must leave your emotions out of the picture.

Why is it so important to avoid emotional decision-making? In short, your emotions during a market downturn—fear, panic, anxiety—cause you to want to do the opposite of what’s best for your portfolio. Emotional decisions don’t take your long-term plans into account. Instead, they only consider the present moment.

When you sell an investment because you’re panicking at the moment, you miss out on the opportunity for that investment to continue to grow. And even though it may not sound like a big deal, missing out on these opportunities can make a huge difference in your portfolio. 

For example, if you invested $10,000 in the S&P 500 in 1999—and left your investments alone through 2018—you’d have ended up with just shy of $30,000 twenty years later . However, if you panicked and missed the best 10 days in the market during that same 20-year period, you’d have ended up with less than $15,000 .  

So, how can you avoid emotional decision-making? A long-term perspective is key.

Invest With a Long-Term Perspective

The key to a good investment strategy is thinking long-term and even looking back at history. If you look at data from any major market downturn over the last century, what happens after each? 

A market up turn. 

Yep—even though recessions can leave a lasting emotional impact, history shows that the market recovers. And these downturns may be shorter than you think—since the end of WWII, the average length of a recession was less than 11 months . 

What does this mean for an anxious investor? When you’re tempted to sell in a panic, remember that the market has always recovered, on average, within a year. 

Keep this long-term perspective in mind when creating an investment plan. Generally, you can afford to take on more risk the further away you are from retirement. Because even if your portfolio loses value during a market downturn, you’ll have plenty of time to let the market recover. 

As you approach retirement, you’ll likely want to reallocate your investments so your portfolio is more conservative. Doing so will ensure that if the market takes a downturn when you’re a few years away from retirement, you won’t see a dramatic drop in your portfolio’s value. 

Investment strategy examples

You can’t control the market, but you can control your investment strategy and the decisions you make. There are countless ways to invest, but here are a few strategies that can help you plan long-term:

  • Index investing: This strategy allows you to invest in a diversified range of securities through a single, passive fund, usually at an affordable price. The goal of an index fund is to replicate the performance of a particular index. 

 

  • Dollar-cost averaging: Dollar-cost averaging is the process of purchasing investments consistently over time at a fixed cost. This strategy smooths out the cost of buying securities so when the market is down, you can get a bigger bang for your buck. 


  • Buy-and-hold investing: In short, this is the strategy we suggest to anyone hoping to avoid panic selling. Rather than trying to time the market, buy-and-hold investing means you buy investments intending to hold them long-term. This strategy relies on a long-term perspective.

 

These strategies, along with others, aren’t mutually exclusive. It may be worth talking with a financial advisor to determine which investment strategies will work best for you, your risk tolerance, and your goals.

4 Tips for Reaching Your Investment Goals (Without Panic Selling)

We can tell you again and again how important it is to avoid panic selling, but it also helps to have some practical tips to put into practice. Here are a few to employ right now: 

1. Have a cash buffer.

When you’re trying to dig yourself out of debt, an emergency fund can keep you from falling back on credit cards. But an emergency fund isn’t just for keeping yourself out of debt, it can keep you from being tempted to cash out your investments, too.

Having a cash buffer on hand will prevent you from being tempted to sell your investments if you get into a situation where you need cash. Know how much money you need to have on hand to feel safe in case of an emergency, and turn to this buffer, instead of your investments, when needed.

2. Don’t use investing for short-term goals.

If you want to pay for a wedding, a house, or your kid’s college education within the next year or two, don’t invest that money. The market may take a downturn, and, when you need the money, it will have lost value. 

When it comes to short-term deadlines, you can’t afford more time in the market for your investments to recover if they happen to lose value. Instead, only use investing for long-term (and sometimes medium-term) goals. And consider a high-yield savings account for short-term goals. 

3. Disconnect from the media (and your investment accounts).

When all you hear and read in the news are anxiety-inducing stories about the bleak economy, it’s no wonder you’re tempted to panic sell and abandon your long-term plan. The doom and gloom are enough to make anyone want to pull out their cash and avoid the tumult. Similarly, checking your account balances during a downturn can be panic-inducing. So just avoid it altogether. 

Instead, rest easy knowing you’ve planned your investments wisely, and temporary market downturns won’t disrupt your strategy in the long run.

4. Get professional financial planning help.

You can plan long-term, avoid looking at your accounts, and save up a generous cash cushion, but sometimes it’s worth the peace of mind to consult a professional, too. If you have any doubts about your investment strategy — or simply want a second opinion — a fee-only fiduciary financial advisor can help. 

Whether you want to leave the strategy to a professional or you just need someone to talk you down from panic selling, it pays — literally — to have an advisor with your best interests at heart. 

Ready to team up with a financial advisor to make sure your investment strategy is capable of long-term success?

Give us a call at 877.333.1015, email us at info@fivepinewealth.com , or visit our website to learn more about what it’s like to work with us.

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What’s the Best Way to Leave Money to Your Children?

June 17, 2026
Key Takeaways Teaching financial literacy and family values is often just as important as passing down money. A thoughtful estate plan can help reduce family conflict and support future generations. Starting your estate planning early, before you feel like you need to, puts you in the best position to protect your family and your legacy. A trust can help you control when and how your children receive inherited assets. At some point, the question stops being "do I have enough?" and becomes "what do I actually do with all of this?" For a lot of families, that includes figuring out how to pass wealth to their kids without creating a mess. Leaving money to your children doesn't have to be an all-or-nothing decision. A thoughtful estate plan can help you transfer wealth in a way that reflects your values while giving your children the support they need at different stages of life. The most effective plans usually combine smart legal structures with ongoing conversations about money, responsibility, and family goals. Will vs. Trust One of the first decisions many families face is whether to use a will or a trust. A will outlines how you want your assets distributed and who will oversee the process. It’s an important estate planning document and serves as the foundation of many estate plans. A trust, however, can offer additional control and flexibility. Assets held in a trust can often pass to beneficiaries more efficiently and allow you to establish specific instructions for how and when assets are distributed. Depending on your goals, a trust may also help provide privacy and additional protection for heirs. For example, rather than leaving a child a large lump sum at age 25, a trust could allow distributions over time or for specific purposes such as education, housing, healthcare, or starting a business. That doesn't mean a trust is automatically the right solution for everyone. Some families have relatively simple estates and may find that a will adequately accomplishes their objectives. If you have younger children or adult children who aren't quite ready to manage a large inheritance on their own, a trust gives you options that a will simply does not. The important thing to remember is that estate planning isn't just a decision about who gets what. It's an opportunity to decide how wealth is passed on and what guidance, if any, accompanies it. Structured Inheritance Strategies Many parents are uncomfortable with the idea of leaving a significant inheritance all at once. That concern is understandable. Most people can think of examples where a sudden influx of money led to poor decisions, strained relationships, or unrealistic expectations. Structured inheritance strategies can help address those concerns while still providing meaningful support. Some common approaches include: Distributing a portion of assets at specific ages, such as 30, 35, and 40. Allowing distributions for education, healthcare, or home purchases. Creating incentives tied to employment, entrepreneurship, or other personal goals. Establishing trusts that provide ongoing oversight from a trustee. Funding educational accounts for grandchildren as part of a multigenerational plan. These approaches allow wealth to be transferred gradually rather than all at once. There is no universally correct formula because every family is different. A child who is financially responsible at age 25 may require very little structure, while another may benefit from additional oversight for many years. Whatever structure you choose, the goal should be the same: to give your children a foundation, not a crutch. Legacy Planning is About More Than Money When people hear the phrase "legacy planning," they often think about legal documents, account balances, and beneficiary designations. Those items matter, but many families discover that the most valuable inheritance isn't financial. Your values, family traditions, work ethic, charitable priorities, and approach to money often have a greater impact on future generations than the dollars themselves. Consider this question: If your children received your wealth tomorrow, would they also understand the principles that helped create it? Many parents spend years teaching their children how to drive, prepare for college , choose a career, and raise a family. Yet conversations about investing, taxes, budgeting, and responsible wealth management are sometimes delayed until much later. Financial education doesn't need to be complicated. It can begin with simple discussions about spending decisions, saving goals, charitable giving , investing, and how money supports the life you want to live. The earlier those conversations begin, the more prepared future heirs often become. Preparing Heirs for Financial Responsibility Heirs are often better prepared when they understand both the opportunities and responsibilities that come with inherited assets. That preparation can happen gradually over time. Parents might involve adult children in family financial discussions, explain the purpose of trusts and estate plans, or share the reasoning behind major financial decisions. Some families even hold annual meetings where children learn about family values, charitable priorities, business interests, or long-term planning goals. These conversations are not about revealing every financial detail. Rather, they help create context and understanding. When children know why wealth exists and what it represents, they are often better equipped to manage it responsibly. For families with substantial assets, introducing adult children to trusted advisors can also be beneficial. Building relationships before an inheritance occurs can make future transitions smoother and reduce confusion during an already emotional time. Generational Wealth Transfer A successful generational wealth transfer involves much more than moving assets from one generation to the next. It requires balancing financial support with personal responsibility. Some parents worry about giving too much, while others worry about not giving enough. Most fall somewhere in the middle. The answer is rarely found in a single document or account balance. Instead, successful wealth transfers often combine: A well-designed estate plan. Appropriate use of wills and trusts. Clear communication among family members. Financial education for future heirs. A shared understanding of family values and priorities. When those elements work together, wealth has a much better chance of creating opportunity rather than confusion. Start the Conversation Now Many parents want their children to enjoy greater financial security than they had growing up. That's a worthy goal, but providing an inheritance is only part of the equation. The structure of the transfer matters, but so do the conversations surrounding it and the values passed along. A thoughtful plan can protect family relationships, reduce uncertainty, and increase the likelihood that your wealth will continue supporting future generations in meaningful ways. If you'd like help evaluating your estate plan, discussing inheritance strategies, or creating a comprehensive legacy plan, the team at Five Pine Wealth Management would be happy to talk it through with you. Call (877) 333-1015 or email us today to schedule a conversation.  Frequently Asked Questions (FAQs) Q: At what age should I leave money to my children? A: There is no universal answer, but many families use a staged distribution approach, releasing funds at specific ages or milestones, such as completing college or reaching age 30, to give heirs time to build financial maturity before managing larger sums. Q: How can I prepare my children to manage an inheritance responsibly? A: Start having age-appropriate conversations about money, investing, saving, and family values. Introducing adult children to your financial advisors before an inheritance occurs is also worth considering; it makes the transition smoother and gives everyone more time to prepare. Q: Do all families need a trust? A: Not necessarily. Some families can accomplish their goals with a will and beneficiary designations alone. A trust is worth considering if you want more control over how assets are distributed, if your estate is more complex, or if your heirs would benefit from some structure around when and how they receive inherited funds.

When Saving Money Starts Getting in the Way of Living

May 21, 2026
Key Takeaways Saving money is important, but constantly postponing meaningful experiences can leave you financially secure and personally unfulfilled. Fear, habit, and identity often play a bigger role in spending decisions than numbers do. A healthy financial plan should support both your future security and your ability to enjoy life along the way. Imagine you’ve saved diligently for decades. You have a healthy income, growing retirement accounts, manageable debt, and investment balances that continue climbing year after year. Yet, somewhere in the back of your mind, a voice keeps saying, “Not enough.” So you hold off on the vacation or skip the kitchen renovation. You tell yourself you will spend more freely later, once things feel more certain. You keep asking yourself the same question, “Can we really afford this?” Sometimes the answer is yes by every objective financial measure, but emotionally, it still feels uncomfortable. For years, personal finance advice has focused heavily on the dangers of overspending. Save more. Spend less. Delay gratification. Avoid lifestyle creep. That advice absolutely matters. Many people would benefit from stronger saving habits. But there is another side of the equation that does not get discussed enough. Some people become so good at saving that they forget what the money was for in the first place. Am I Saving Too Much?  This question sounds almost absurd, and many people feel uncomfortable asking it. In our culture, saving is viewed as responsible and disciplined. Spending often gets framed as careless or indulgent. So when someone continues accumulating wealth year after year, nobody really raises concerns. But over-saving can create its own problems. We have worked with people who consistently save large percentages of their income while postponing almost everything meaningful to them. They delay vacations. Put hobbies on hold. Continue working in stressful jobs long after they financially need to. They keep waiting for some future point where they will finally feel safe enough to enjoy what they built. The challenge is that “enough” can become a moving target. As portfolios grow, lifestyles usually grow too. Concerns about inflation, healthcare costs, market volatility, taxes, and longevity all start competing for attention. Even financially successful people can develop a persistent fear that one wrong decision could jeopardize everything. That fear is often emotional rather than mathematical. In many cases, the numbers support far more flexibility than the person believes. The Psychology of Saving Money Saving behavior is deeply tied to emotion, identity, and the stories we tell ourselves about security. Understanding why you save the way you do is the first step toward making more intentional choices. Fear of running out is one of the most powerful drivers. Even people with substantial assets can feel that their wealth is fragile, particularly if they grew up without financial stability or lived through a major market downturn. The brain tends to overweigh dramatic losses compared to equivalent gains, which means the emotional pain of imagining a depleted account is often disproportionate to the actual probability of it happening. Habit reinforcement plays a significant role as well. If you spent 30 years in accumulation mode, consistently saving and reinvesting and growing, your financial behaviors became deeply ingrained. Transitioning from saving to spending, even intentionally, and when the numbers support it, can feel wrong at a gut level. The habits that built your wealth can work against you when the time comes to use it. Societal pressure adds another layer. High-earning professionals are often surrounded by messages that equate financial discipline with virtue. Spending on yourself can feel indulgent or even irresponsible, even when it’s neither. There is a difference between careless spending and deliberate investment in your own well-being, but the cultural script often blurs that line. For business owners and dual-income households, there is also the identity piece. When so much of your sense of self is tied to building, growing, and accumulating, shifting toward enjoyment requires a genuine psychological reorientation, not just a new budget line. Values-Based Spending Over-saving isn't fixed by spending more randomly. What actually helps is spending with intention — putting money toward things that genuinely matter to you. This is what we mean by values-based spending : aligning how money flows with what you care about. The exercise starts with a conversation about what you want your life to look like. Not the life you think you should want, and not the life your parents had or your colleagues' project, but the experiences, relationships, contributions, and comforts that would make your days feel meaningful and full. From there, a good financial plan becomes a permission structure. When your advisor can show you, concretely, that your goals are funded and your risks are managed, spending stops feeling like a threat to your security. It starts feeling like money doing what money is supposed to do. Values-based spending also helps you stop spending on things that don’t matter to you. Many high earners discover that their default expenditures have drifted away from their priorities over time. Redirecting those dollars toward what genuinely matters often feels better than a raw increase in spending. Signs You May Be Under-Living Financially A few patterns tend to show up repeatedly among chronic oversavers: You feel guilty spending money even after careful planning. Your savings goals continue increasing without a clear reason. You postpone experiences you deeply want because you “might” need the money someday. You struggle to define what financial freedom would look like for you. Your net worth keeps growing, but your day-to-day life feels largely unchanged. You continue working at a pace that negatively impacts your health or relationships, despite already being financially secure. None of these automatically means you are saving too much. But they are often signals worth examining more closely. Practical Steps to Align Your Money With Your Life Making the shift from over-saving to purposeful living does not require a dramatic overhaul. It starts with a few honest conversations and a willingness to examine some long-held assumptions. Start by revisiting your retirement projections with a financial advisor. Ask specifically what your models say about your ability to spend, not just your ability to accumulate. Many clients are surprised to find that their plan supports significantly more lifestyle spending than they had assumed. Build a "permission budget" for discretionary spending. This is not a ceiling on enjoyment but a deliberate allocation toward experiences and priorities you have identified as meaningful. Giving yourself explicit permission to spend in certain areas, backed by a sound financial plan, reduces the guilt that often accompanies even well-deserved expenditures. Consider what you are waiting for. If the answer is a number that keeps moving, or a level of certainty that financial markets will never provide, it’s worth exploring whether the hesitation is financial or psychological. A good advisor can help you separate the two. A Healthy Financial Plan Should Support Your Life A strong financial plan should create confidence, not permanent deprivation. Saving diligently is important, but there is also value in recognizing when enough may already be enough. The goal is for your spending to reflect your values, your priorities, and where you are in life right now. Because eventually, there has to be a point where the money begins serving you instead of the other way around. If you’ve been wondering whether your saving habits still align with the life you want to live, we’d love to help you think through it. At Five Pine Wealth Management , we help clients build financial plans that support both long-term security and meaningful living today. Call us at 877.333.1015 or email us at info@fivepinewealth.com to start the conversation. Frequently Asked Questions (FAQs) Q: Why do I feel anxious spending money even when I can afford it? A: Spending anxiety is often tied to the psychology of saving money. Past financial stress, market downturns, family experiences, and years of disciplined saving can condition people to associate spending with risk, even when their financial plan supports it. Q: Can over-saving negatively affect your quality of life? A: Yes. Constantly delaying travel, hobbies, family experiences, or personal goals in pursuit of “more” can lead to burnout, stress, and missed opportunities. Financial security matters, but so does enjoying the life your money was meant to support.