Of course, in my humble opinion, there is no amount of lost-money-on-paper that would ever be worth “leaping” over. But if you don’t look at your statements, does it make it any less painful? Perhaps simply speculating that it is “probably not as bad as we think”, or even that it is worse than it (actually) is, may provide a source of comfort. After all, what we don’t know (for certain) can’t hurt us, right? But is this going to serve you best in the long term if you continue to ignore it?

If they haven’t already started trickling into your inboxes and mailboxes, be warned; it’s quarterly statement time, so the financial report cards from your IRA, 401k’s, and brokerage accounts should be arriving shortly for your viewing pleasure. What should you do? Our advice: Pull out a bottle of nice french wine that you’ve saved for a special occasion and start opening the envelopes.

First and foremost, the best advice for any investor is not to panic. Assess your financial timeline and goals, and depending on your short and long term needs, you may need to make some modifications given current market conditions.  According to Financial analyst and “Two for the Money” co-author Jonathan Murray,  “The most successful investors resist the crowd mentality. They go against the herd. So, right now everyone’s saying, ‘Get to cash.’ But I think the really smart investors are quietly and patiently making a list of stocks that they’re buying, not selling,” Murray said.

As the market sell-off has dragged on, your stock allocation might be a much smaller percentage of your portfolio than you intended. Likewise, your bond allocation could be considerably more than ideal. You may want to take this opportunity to rebalance; if you are in or nearing retirement, experts recommend 3-5 years of “cash cushion” or cash flow that will be available outside of equities. If you don’t have a trusted financial advisor, now may be a good time to find one. Take advantage of the knowledge and experience of others if you can.

Given that the S&P 500, Dow Jones industrial average and the Nasdaq are all down over 25 percent in the past year, it can be tempting to avoid looking at what you know in your heart of hearts won’t be a stellar report.  Unless you or your financial advisor were able to predict the events of this year and had the divine foresight to make the changes required to avoid the losses associated with being vested in stocks, the news will most likely not be good. But you need to know where you stand, and based on that news, take action to rebuild and re-distribute your portfolio (as necessary). And you can’t do that by sticking your head in the sand…

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