The coronavirus pandemic is changing life for people all over the globe in countless ways. The changes are wide-ranging and affect some in completely different ways than others. A young working mom with two school-age kids is dealing with issues much different than those of a retired person in their 80s. One may be facing hardships related to work and child care and income. The other may be looking at severe health risk, personally or involving a partner. Each is encountering stress and hardships of some kind. In this time it is easy to let scarcity become a driving force. Scarcity of physical resources (hand sanitizer, protective masks, and toilet paper, for example) – of money (loss of work income, drop in value of retirement savings) and of the ability to move about and gather are very real.
How do we deal with this new and significant scarcity? We know that people feel negative outcomes more strongly than positive ones. Behavioral finance tells us this is especially true in the world of investing and the study of. Does one’s financial behavior offer a clue as to how one deals with scarcity? Does a person that nervously checks the value of their 401(k) account daily also rush out to the grocery store to stock up on milk and bread at the prospect of a snow storm? Does the person who rarely frets about the value of their IRA also ignore the news about toilet paper shortages during the coronavirus pandemic?
Personality types certainly have something to do with how some are coping in this uncertain and difficult time. Individual and collective life experiences may also shape how we handle what we are encountering. My mother is an introvert and child of depression-era parents. She’s continuing to do many of the same simple things that have given her joy for decades: taking walks in the neighborhood, doing the crossword, checking out the wonderful plants blooming in her garden, talking to her kids, and expressing concerns about others, not herself. Inheriting some of her traits and being a member of Generation X have both helped me. I grew up in the 70s and 80s when I was told to “go outside and play” whenever I complained of boredom (which was not often). We created our own entertainment. Being told to stay home now is not a hardship for me. Losing a job or having your business shut down and having to lay off workers are real hardships.
My mother lends me perspective when she shares about her childhood in the Upper Peninsula of Michigan. Her stories mostly deal with the resourcefulness of her parents, her uncles that died in the Great War, and the simple, hard, but love-filled life she remembers. Maybe my childhood stories will give my kids perspective and hope that this difficult time will pass and we will be stronger together in the end. In the past few weeks, I’ve seen no scarcity of generosity, sacrifice, togetherness and humor in the face of adversity. Those things I believe we have in great abundance, regardless of our personality type or our life experience. That is what I can choose to focus on and share with others.
Any opinions are those of David Werle and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notices.