There’s a powerful psychological process going on in the mind of my demographic cohorts right now.
We are fighting between fear and opportunity.
We are afraid of getting sick or losing loved ones to Covid-19. We are worried about our young children’s future as we live in a nation so divided.
But we also feel like we have had fears before, in past seasons of our young working lives. We embraced that fear too much, instead of seeing the opportunity that could be.
We didn’t believe in America’s resilience. We should have.
We aren’t going to miss it this time.
In 2001, older millennials like myself, were just starting college. We were in a new place, ready to experience more of life and awed by what educational and social opportunities college life had to offer. And then the world changed. 9/11 happened just three weeks into living away from “home” for the first time.
It took several years, but the world found its footing again after the shock of 9/11 and the bursting tech bubble that hurt so many investors and the retirement savings of our parents and grandparents. We were graduating college by that time, and looking for our first jobs.
Just as we were settling into our lives as “grown-ups,” the financial crisis happened. And the world changed again.
The financial crisis was scarring in so many ways, for so many. For my cohort, we were early in our careers, and institutions that perhaps we didn’t know THAT much about, but knew of their might and power at least, disappeared overnight.
So did a lot of the measly 401ks we had built for just a couple years by then.
Sure enough though, we recovered. The market, the economy, found sturdy ground again. Friends that lost jobs found new ones, and the long rally started.
But maybe, we didn’t trust it enough to participate. Something else could happen at any second.
We weren’t all ready to run into the market, but we changed what we did with our money.
Many of us stopped buying frivolous “stuff” like clothes and expensive cars and instead focused on what is harder to take away with a crisis: memories from vacations and other experiences, like long brunches with friends.
The last two crises scarred our psyche in ways maybe we can’t really identify. But it was a reminder, twice, that nothing was certain, including wealth, and the market could tumble without warning.
Was it really safe to wade into the murky water?
Going into the pandemic, we older millennials, had a couple of crises we had watched in our formative career and investing years.
Both were frightening, but both passed.
We weren’t going to be fooled a third time.
I have friends that wished they had “play” money to plow into the market in late March.
One friend told me he bought beaten-up energy and airline stocks in March and early April because it just felt like history taught him this would pass. Airlines are critical companies we all depend on. Energy companies supply fuel in an economic recovery. Those stocks had to go back up.
Even I learned my lesson… eventually. I am a VERY cautious “investor” in the mutual funds and ETFs we are allowed to invest in. Even I thought: ‘I have missed opportunity twice. I’m not missing this again,’ and I pulled some, not a lot, into the market.
At one point, Amazon just sold books online, and it wasn’t $2,600 a share. Many of us missed the chance to buy into that because the scars were too fresh.
And IF the market doesn’t turn around like it has in the past, if the third time is NOT the charm, at least we tried this time.
Maybe we will walk away with a participation trophy.