I recently had the opportunity to listen to a presentation by Dr. Paul Stoltz, author of the book The Adversity Advantage, about a concept he calls the Adversity Quotient or AQ. In a nut shell, AQ is a measurement of how well someone deals with adversity and he believes that resilience is the single most important indicator of success. Given the adversity which faces us each and every day in today's economy, everyone gave Dr. Stoltz their full attention.
The message is as significant as it is simple. Everything is a matter of cause (situation) and effect (response). We cannot control the situation, but our resilience can help shape our response. As it specifically relates to the financial crisis Dr. Stoltz said "We cannot turn the dial on the world economy, but there are a number of things we can do." It was a defining moment. He is right. The economy is a fact. The market has suffered losses. History is beyond our control. Now, What are you going to do next?
If you are hoping to find a one-size-fits-all solution or a quick fix, let me know when you find it. I do not have an easy answer. But I can recommend that this is an excellent to time to reassess and look at your financial position from a distance. Are you still in line to meet your financial goals? If not, what needs to change? Maybe the goal is no longer realistic or maybe it is.
Most of my time these days has been devoted to helping clients assess their retirement plans and discussing the alternatives. Sometimes they decide to change their plans by postponing retirement. Other times they are willing to allocate more resources towards meeting the original goal. And others have decided to redefine their retirement. Everyone has reconsidered their exposure to risk. No decision is right and no decision is wrong. The biggest potential mistake is choosing to ignore the situation and do nothing.
I am incredibly excited about the future. I always remember the words of Peter Lynch (paraphrased) "I have no idea which direction the next 1000, 2000 or 4000 points in the market will be, but I am confident that the next 10,000, 20,000 and 40,000 points will be up." I do not think market recovery is the question. The question is when.
I leave you today with The Portable Pep Talk by James J. Metcalfe:
I get discouraged now and then when there are clouds of gray,
Until I think about the things that happened yesterday.
I do not mean the day before, or those from months ago.
But all the yesterdays in which I had a chance to grow.
I think of opportunities that I allowed to fall aside
And those I took advantage of before they passed me by.
And I remember that the past presented quite a plight.
But somehow I endured it and the future seemed all right.
And I remind myself that I am capable and free,
And my success and happiness are really up to me.
You control your response. What are you going to do next?
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