Financial Planner Bart Zandbergen On How Managing Emotions Leads To A Healthier Bottom Line

Financial Planner Bart Zandbergen On How Managing Emotions Leads To A Healthier Bottom Line

June 11, 2020 by Bart Zandbergen

Little did I know that I would be experiencing the fourth major stock market correction of my career, right here, right now, in 2020. However, while it’s a roller coaster of world events and emotions, I am grateful to have the tools mentally and emotionally, as well as nearly three decades of experience, to assist my clients in navigating this storm.

1992 was the beginning of my career in wealth management, and a few short years later, I obtained my CFP certification. Prior to entering the industry, I experienced the notorious Black Monday of October 1997. As an advisor, I helped clients through the tech bubble from 2000 to 2002 and the financial industry meltdown from 2007 to 2009, and now, we are weathering COVID-19.

I entered the financial services industry because I wanted to have a positive impact on people’s lives.I find so much purpose in being able to help people maximize their finances so they can lead more fulfilled lives. Guiding men and women so they can see their financial goals and dreams realized is beyond rewarding.

In 1992, the stock market was in the beginning stages of a roaring bull market. It was not uncommon to have clients in a 90/10 or 80/20 allocation of equites/fixed income. In fact, the joke (that was actually somewhat serious) at the time was if clients were not earning at least 20% per year, we as advisors would get fired. Then reality set in as we entered 2000 with the tech bubble (aka “Tech Wreck”). The market proceeded to lose nearly 50% over the following two-year period.

After bottoming out in 2002, the market picked itself up, dusted itself off and began another five-year bull run. As the cycle would have it, just after rebounding and reaching new market highs in 2007, the global financial system collapsed, causing a new 40% market drop over the next two-year period until March 2009. That began what is now the longest expansion and bull market recovery from March 2009 to March 2020 with markets hitting all-time highs. We sit here today fighting a war with an “invisible” enemy and facing a 35% market correction in a mere three weeks.

While I am just as saddened by the world’s loss and stressful times, I find myself in a familiar role: trusted advisor, confidant, friend, rock and unofficial shrink. The good news is that most of my clients are level-headed and know to turn to their trusted advisor so they don’t make emotionally fueled decisions. Many clients of mine have been with me for over 20 years, so we have been through challenges before. While each challenging period has been unique and different, what has remained the same is that each time, we successfully arrive to the other side—better than before. They know that I will not panic, and I will not allow them to panic. We trust our plan and the process, which is not fueled by emotion but instead architected with smart strategy. While we are not immune from market losses, we have substantially mitigated the losses due to our non-emotional plan.

Here are some things that we know:

  1. Markets cycle.
  2. Recessions are inevitable.
  3. Diversified portfolios can help to reduce market risk.
  4. Market timing is a fool’s game.
  5. If you missed the 10 best market days (January 1, 2000- March 13, 2020), you lost 76% of your return.*
  6. Missing the 20 best market days in the last 20 years resulted in your average annual return for those 20 years being negative.*
  7. Seven of the 10 best days occurred within two weeks of the 10 worst days.*
  8. The average investor trails the S&P 500 by 66% due to emotional moves.**
  9. Recessions end, markets correct and hit new all-time highs.
  10. Things are never as good as the sound or as bad as they feel.

Here are some adjustments that I have learned to make during turbulent times so I can be there more for my clients (virtually of course!) as feelings of uncertainty arise. First things first: Communication is critical. I have increased my communication with my clients by 500% between calls, emails, newsletter debriefings and Zoom calls. Next, we have increased investment committee meetings at my firm, and I have increased communication with my trusted financial partners and sources. Finally, I have increased portfolio activity from analyzing investments and strategies to being proactive in buying opportunities to portfolio rebalancing. Right now, small adjustments add up in a big way.

Throughout my career journey, I have learned that everyone has an emotion about money. I have also learned that the emotion is much stronger regarding the fear of loss than it is about the possibility of gain. Interesting right? Everyone’s money is important to them—regardless of the amount. That is why after the 2002 recession, I began creating a portfolio allocation that focuses on capital preservation for times like this, which are a part of the market journey. When I think about what one of my ultimate how-managing-emotions-leads-to-a-healthier-bottom-lineBart Zandbergenlessons learned has been, one that rings true now more than ever is that emotional responses are normal as we are human; however, being able to refrain from emotionally driven financial decisions is priceless.

* FactSet, Standard & Poor’s, J.P. Morgan Asset Management. Data are as of March 13, 2020.

** J.P. Morgan Asset Management; (Top) Barclays, Bloomberg, FactSet, Standard & Poor’s; (Bottom) Dalbar Inc












Financial Planner Bart Zandbergen On How Managing Emotions Leads To A Healthier Bottom Line

June 11, 2020 by Bart Zandbergen

Little did I know that I would be experiencing the fourth major stock market correction of my career, right here, right now, in 2020. However, while it’s a roller coaster of world events and emotions, I am grateful to have the tools mentally and emotionally, as well as nearly three decades of experience, to assist my clients in navigating this storm.

1992 was the beginning of my career in wealth management, and a few short years later, I obtained my CFP certification. Prior to entering the industry, I experienced the notorious Black Monday of October 1997. As an advisor, I helped clients through the tech bubble from 2000 to 2002 and the financial industry meltdown from 2007 to 2009, and now, we are weathering COVID-19.

I entered the financial services industry because I wanted to have a positive impact on people’s lives.I find so much purpose in being able to help people maximize their finances so they can lead more fulfilled lives. Guiding men and women so they can see their financial goals and dreams realized is beyond rewarding.

In 1992, the stock market was in the beginning stages of a roaring bull market. It was not uncommon to have clients in a 90/10 or 80/20 allocation of equites/fixed income. In fact, the joke (that was actually somewhat serious) at the time was if clients were not earning at least 20% per year, we as advisors would get fired. Then reality set in as we entered 2000 with the tech bubble (aka “Tech Wreck”). The market proceeded to lose nearly 50% over the following two-year period.

After bottoming out in 2002, the market picked itself up, dusted itself off and began another five-year bull run. As the cycle would have it, just after rebounding and reaching new market highs in 2007, the global financial system collapsed, causing a new 40% market drop over the next two-year period until March 2009. That began what is now the longest expansion and bull market recovery from March 2009 to March 2020 with markets hitting all-time highs. We sit here today fighting a war with an “invisible” enemy and facing a 35% market correction in a mere three weeks.

While I am just as saddened by the world’s loss and stressful times, I find myself in a familiar role: trusted advisor, confidant, friend, rock and unofficial shrink. The good news is that most of my clients are level-headed and know to turn to their trusted advisor so they don’t make emotionally fueled decisions. Many clients of mine have been with me for over 20 years, so we have been through challenges before. While each challenging period has been unique and different, what has remained the same is that each time, we successfully arrive to the other side—better than before. They know that I will not panic, and I will not allow them to panic. We trust our plan and the process, which is not fueled by emotion but instead architected with smart strategy. While we are not immune from market losses, we have substantially mitigated the losses due to our non-emotional plan.

Here are some things that we know:

  1. Markets cycle.
  2. Recessions are inevitable.
  3. Diversified portfolios can help to reduce market risk.
  4. Market timing is a fool’s game.
  5. If you missed the 10 best market days (January 1, 2000- March 13, 2020), you lost 76% of your return.*
  6. Missing the 20 best market days in the last 20 years resulted in your average annual return for those 20 years being negative.*
  7. Seven of the 10 best days occurred within two weeks of the 10 worst days.*
  8. The average investor trails the S&P 500 by 66% due to emotional moves.**
  9. Recessions end, markets correct and hit new all-time highs.
  10. Things are never as good as the sound or as bad as they feel.

Here are some adjustments that I have learned to make during turbulent times so I can be there more for my clients (virtually of course!) as feelings of uncertainty arise. First things first: Communication is critical. I have increased my communication with my clients by 500% between calls, emails, newsletter debriefings and Zoom calls. Next, we have increased investment committee meetings at my firm, and I have increased communication with my trusted financial partners and sources. Finally, I have increased portfolio activity from analyzing investments and strategies to being proactive in buying opportunities to portfolio rebalancing. Right now, small adjustments add up in a big way.

Throughout my career journey, I have learned that everyone has an emotion about money. I have also learned that the emotion is much stronger regarding the fear of loss than it is about the possibility of gain. Interesting right? Everyone’s money is important to them—regardless of the amount. That is why after the 2002 recession, I began creating a portfolio allocation that focuses on capital preservation for times like this, which are a part of the market journey. When I think about what one of my ultimate how-managing-emotions-leads-to-a-healthier-bottom-lineBart Zandbergenlessons learned has been, one that rings true now more than ever is that emotional responses are normal as we are human; however, being able to refrain from emotionally driven financial decisions is priceless.

* FactSet, Standard & Poor’s, J.P. Morgan Asset Management. Data are as of March 13, 2020.

** J.P. Morgan Asset Management; (Top) Barclays, Bloomberg, FactSet, Standard & Poor’s; (Bottom) Dalbar Inc