The scars of the recession and how to move past them

Even after a seven-year bull market, many investors still suffer emotional fallout from the 2008 financial crisis, which can make it harder to focus on long-term financial goals.

A recent UBS Investor Watch survey found that while people do understand rational investment principles, emotion often intervenes. For example, although two-thirds of those surveyed said they believe the fundamentals of the U.S. economy are strong and that now is a good time to buy stocks, almost 9 out of 10 have maintained or increased their cash holdings since 2008.

But the survey also revealed that a financial plan helps investors manage the rationality/emotionality conflict, with virtually all respondents saying their plan keeps them on track and helps them focus on long-term goals rather than daily market fluctuations. An outside professional like your Financial Advisor can help you both develop your plan and maintain equilibrium in the face of market gyrations.

Other highlights from the survey:

  • 86% of investors said their experience during the 2008 crisis affects how they think about money today.
  • Three out of four feel overwhelmed by global concerns, saying they find it difficult even to follow everything that’s happening.
  • Domestic issues, too, are a worry for more than 75% of respondents, who say they’re anxious about how the upcoming presidential election and the national debt might affect the economy and financial markets.

If these concerns sound familiar, talk with your Financial Advisor about how a financial plan can help you make more rational investment decisions.

UBS Investor Watch is a quarterly survey that tracks and analyzes investor sentiment. For this edition, UBS surveyed 2,638 investors with at least $1 million in investable assets. For complete results, view the interactive report or download the full report (PDF, 1 MB). Then talk to your Financial Advisor to see how these insights can help guide your investment decisions.