Freefall

Man Falling

Last time I posted, the financial markets were hitting a new peak. Having been a trader for five years, stock valuations were bothering me. For the preceding few weeks, I pulled small amounts out of the market. Not enough.

Since, I have watched as my investment account values have plummeted. Most of the gains I had made on my portfolio in the past year have now been erased.

The pain of losing is psychologically about twice the pleasure of gaining. In my position, it feels more like ten times the pain vs. the pleasure I received from watching my stocks gain ground month after month.

Without any income or job prospects, I feel like a my sinking ship hit an iceberg and got a nice big rip on the bottom. To compound the issue, I even bought into a sinking market, converting needed cash into even more paper losses. Now my already record low confidence in making decisions is also on a downward spiral. Not good when you need to rely on decision making to somehow find a way out of this giant pickle.

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To top it all off, I’m still getting nowhere with selling my property in NYC. Volume of people visiting the property have been o.k., but not great. Still no offers. Just feedback that I need to fix the windows, or the floors or the vents on the deck. More cash sunk into something I’ll never get back out. No thanks.

Since flight prices last month were so high, I ended up needing to use miles to go back and forth to NYC from Chicago. The only flights I could get were odd times which has left me by myself in NYC for five days a week pretty much all March. The frustration and loneliness this brings amplifies an already bad situation.

So, obviously things are really really shitty right now. My body is reacting by giving me mad insomnia and anxiety. Today, my hands were actually buzzing at one point. Physically buzzing like if electricity was flowing through them. I’m seeing a therapist in Chicago. I think its time I have him cut me a script to help. Not sure what else I can do at this point.

What am I doing to try to make my situation better? Well, I’m re-evaluating the strategy behind everything I’m doing because status quo seems like it can persist a really long time. The comfort around having ample savings is rapidly deteriorating. My wealth is falling at the same time outflows are happening in my accounts. A large tax payment is also looming five weeks from now which is going to significantly sting. Most, if not all of my cash on hand, will go to meeting this payment. This will leave me with little wiggle room on liquidity. The shit is now hitting the fan.

So, in a nutshell, mentally I’m in the downward spiral of depression, anxiety and general hopelessness. Financially, I’m hemorrhaging. Although its always impossible to call a bottom, I’m sort of thinking that 10 years from now I’ll look back and realize that I’m now approaching the lowest point.

So, when in times of crisis, follow the physician’s playbook:

#1 — Stabilize the patient

Mentally, this means seeing my therapist as often as I can. Unfortunately it will likely also mean going on a subscription here to help calm down my mind. Exercise and healthy eating are also mandatory here. I have been jogging and taking long walks almost every day, which I find works well in putting my mind in a better place. Also, I need to stop paying attention to CNBC all day and staring at my stocks. I need to “tune out” for awhile and just focus on more productive areas of my life. Things I can control.

Financially, this will entail finishing up my detailed financial statements and budget showing (a) my current state of affairs, (b) my current outflows (inflows are easy as they are zero) and (c) an assessment of how long I can go before I am cutting into my retirement accounts. I’ll need to put together a longer-term plan for the most worst case long-term scenario where I go many years without work or any income and the economy melts down into a nightmare recession. This is the “pure survive at all costs” forecast.

#2 — Develop a short-term plan

Once everything is more stabilized, which I am hoping I can do by April 15th, the day my taxes are due, I can move onto my short-term plan.

Mentally, this will likely mean staying on a prescription and continuing therapy. Getting on a daily exercise routine and eating as healthy as possible will assist. I also need to finish reading about how to calm my mind better.

Financially, I’ll unfortunately need to consider a job whether its part-time or full-time to hold me over. In many ways, I can’t believe its coming down to this but so be it. Its a really steep slippery slope. Probably the best piece of advice that I’ve received lately was that when you are stuck in the middle of the pond, just begin paddling. I need to begin paddling.

Additionally, I need to put a lot of work into developing alternative streams of income so that I am never in this situation again. I struggle with how to get going in this regard but I need to just begin, somehow someway.

Lastly, I need to develop a better plan for selling my apartment. It probably includes hiring a broker, cutting the price, and just stomaching a major hit when I sell it. Urgh. I need to act now though because my six month listing agreement expires next week and I need to make some hard decisions now about what to do.

#3 — Develop a long-term plan

I struggle at this point with what this looks like but my longer-term goals are #1 to work for myself and #2 compound capital at double digit rates. That’s the spinal cord of my plan. Now I need to put more bones on it.

Looking forward to having better updates soon. While typing this out, the DOW went up a couple percentage points, so hopefully I’ll see some relief on the financial side sooner than anticipated.

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