I invested in the stock market and all I got was this nervous breakdown.
Managing investments can feel overwhelming, especially if you’re an American living in Israel with U.S.-based assets. The distance, time zone differences, and market volatility often contribute to financial anxiety. However, by implementing the right strategies, you can actively manage this anxiety and keep your financial goals on track.
Finding Stability in Uncertain Times
Financial anxiety often stems from a lack of control or uncertainty. Expats often face additional stress due to cultural differences. In the U.S., long-term financial planning, such as saving for retirement, takes priority. In contrast, Israel may emphasize immediate needs like homeownership. These conflicting priorities create tension and uncertainty, particularly when family members in both countries offer differing advice.
Market volatility also plays a significant role in increased financial anxiety. Watching your portfolio fluctuate can be unsettling, especially when you’re far from the action and rely on potentially delayed news updates. However, remember what Mark Twain wisely noted, “I’ve had a lot of worries in my life, most of which never happened.” His words remind us that many of our fears stem from hypothetical scenarios that may never come to pass. Instead of allowing fear to drive your decisions, focus on your long-term strategy. Remember, markets rise and fall, and over time, maintaining your course often yields better results than reacting to short-term changes.
Consider the impact of currency fluctuations as well. For dual citizens or expatriates, managing investments across different currencies adds another layer of complexity. The value of the U.S. dollar against the Israeli shekel can shift, impacting the overall value of your investments when converted to your living currency. Balancing investments in various currencies helps mitigate risks tied to currency fluctuations, ensuring that a dip in one currency doesn’t disproportionately affect your financial health.
Actively Addressing Anxiety
Recognizing financial anxiety before it escalates is vital. You might avoid financial tasks, like checking your investment statements, because you’re afraid of what you might see. Or perhaps physical symptoms—such as a racing heart, tension headaches, or sleeplessness—surface whenever you think about your finances. These symptoms signal that your body is under stress and addressing them early prevents long-term health issues.
To regain control, begin by setting small, achievable goals. The ancient Chinese philosopher Lao Tzu, known for his teachings on simplicity and humility, said, “The journey of a thousand miles begins with one step.” This powerful idea suggests that taking the first step—such as increasing your retirement contributions by just 1%—breaks the cycle of inaction and initiates positive changes. Over time, these small steps build momentum, enhancing your financial confidence.
Regular check-ins with your financial advisor also play a crucial role in managing anxiety. These meetings provide educational moments and opportunities to reassess your financial strategy. Advisors offer the perspective needed to look beyond short-term market noise, keeping you focused on your long-term objectives.
Building Lasting Financial Habits
Creating positive financial habits serves as an effective method for managing financial anxiety. Automation simplifies the process. By setting up automatic transfers to your savings or investment accounts, you consistently build your financial security without the need for constant attention. This automation reduces the mental burden of remembering to save or invest and ensures you stay on track even when life becomes hectic.
Changing how you view money also helps reduce anxiety. Rather than seeing money as a source of stress, recognize it as a tool that helps you achieve your goals. Whether you’re supporting your family, funding your retirement, or simply enjoying life, money should serve as a means to an end. Celebrate small financial successes to reinforce positive behaviors that contribute to long-term stability. These small wins shift your mindset, easing stress and reinforcing positive financial habits.
Maintaining a diversified portfolio is essential for any investor. Diversification spreads risk across various assets, reducing the potential impact of market-specific downturns. For Americans living in Israel, this means focusing on balancing different types of investments, such as stocks, bonds, and other asset classes, to ensure stability. By diversifying within the U.S. market, you protect your portfolio from the volatility of any single investment, maintaining a more consistent and resilient financial strategy.
By addressing and managing your financial anxiety, you can actively shape a secure future, even from across the globe. Build a support system of professionals who understand the complexities of cross-border investments. Financial advisors, tax experts, and legal professionals specializing in international finances offer invaluable guidance, ensuring your strategies remain effective and compliant with relevant regulations.
For additional ways to manage financial stress and refine your investment approach, I encourage you to visit www.profile-financial.com/tackling-investment-stress. This resource offers practical strategies to help you navigate the emotional and psychological challenges of investing. By applying these insights, you can construct a more resilient financial future—one that brings peace of mind, no matter where you are in the world.
Douglas Goldstein, CFP® is the director of Profile Investment Services, Ltd. www.Profile-Financial.com. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of this website, Portfolio Resources Group, Inc. or its affiliates. Nothing in this article is intended to be investment, tax, or legal advice. Information in this article is gathered from sources considered reliable, but we cannot guarantee their accuracy. Past performance is no guarantee of future returns.
