We really like these Five Tips from IFA Alex Riley which can be found on the Morning Star website, they really sum up the common-sense calm approach to investing that everyone needs to keep in mind in these worrying times.

PERSPECTIVES: Stick to your investment goals and horizons, don’t sell at the point of panic and if you can’t take the bad news anymore, turn the TV off, suggests IFA Alex Riley

1. If you have followed a financial plan, then sufficient levels of cash should already be held in reserve for shorter term requirements. If this is the case, then you should not be dependent on access to your investment portfolio right now.

2. If you still maintain an investment horizon over a number of years from today, it is important to remember that it is the value of your investment in the future that is key and not the value today.

3. Making the assumption that your portfolio is falling at the same rate as the various global stock markets reported in the media also assumes that you are invested 100% in those markets. In reality most investors following an asset allocation plan will have capped exposure to the stock market, therefore if your portfolio is allocated 50% stocks and 50% bonds then you will have approximately half the exposure to any stock market volatility.

4. Selling now would trigger an actual loss rather than what is currently a paper loss and if you sold now where would you put the receipts to enable you to recoup any losses?

5. Markets move quickly as we have seen in the last two weeks or so. If and when a recovery comes it is also likely to be swift so market timing, trading in and out, could leave you even worse off if you get it wrong.

It is perfectly natural and understandable to take fright from the current volatility however the key to traversing the current problems is to not panic, take a step back to calm your thoughts, remember your original reasons for investing and only take action if is absolutely necessary for you to do so. Sometimes it might even be worth turning the television off if it spares you from taking the wrong action.

To read further

http://www.morningstar.co.uk/uk/690/articles/100365/Five-Tips-for-Staying-Sane-When-Markets-Go-Mad.aspx

US and Europe Debt Crisis - Best Advice

Don't panic! Don't follow the herd and jump like lemmings off a cliff!

The global debt crisis is extremely worrying for many clients approaching retirement or who are dependant on income from their investments to supplement their retirement pensions, however it is very important that you stick to your advisor's original plans as you should be invested in a portfolio able to withstand the ups and downs of the markets. Whilst you can't guarantee your values will never go down, a degree of protection is usually inbuilt by spreading risk across a number of different asset classes i.e. equities, fixed interest, property, bonds etc. Therefore just viewing the FTSE is not giving you the full picture and may cause unnecessary panic.

Many investors feel when markets start to fall we should run for shelter and straight into cash funds to protect what gains we have left, however a day on the stock markets is a long time and a day out of your fund when a correction comes could mean it takes you longer to regain your losses than if you'd have just sat tight.

It’s my opinion that this current debt crisis looks set to be with us for the long term however we always take our lead from the US and I think we're waiting for them to come up with a short term answer and proposals to their problems. This should then give some confidence back to the UK and Europe. Volatility will remain, however I would expect to see short term relief by the end of this week.

I urge clients not to panic, if you're in a Pension with Hartford or MetLife you have nothing to worry about at all as you have got inbuilt protection and your pensions will still be based on your last highest valuation, if you don't have one of these plans ring me and ask me about it. Clients with investment bonds with Prudential have more than likely got 5 year protection to their fund value.

If you have any concerns or queries please feel free to call me on 01652 680859.