The people of Britain have spoken. Britain is leaving the European Union. This move has sent ripples across the structure of the global economy. If you’re investing your money for savings or your retirement pension, this Brexit also impacts you on a more personal level. You may need to make some adjustments in your investment strategies to take advantages of these coming changes. At the least, you may need to take steps to protect the investments you already have.
When we put aside all the hyperbole, prognosticating and gnashing of teeth aside, we realize that we simply don’t know how the U.K.’s exit from the European Union is actually going to play out. We don’t know what’s going to happen to the region’s economic performance in the short term. We can predict the future of the EU but we can’t say for certain if our guess is right.
Guessing can be an entertaining endeavor in some situations, but not in long-term investing. When it comes to risking our money, speculating on the direction of the global economy can be costly. Trying to navigate the murky waters of investing in the wake of the Brexit vote can be confusing and even intimidating. Not to despair: there are a few steps you can take that may help you tread the choppy seas expected in the financial markets for the next few years.
Keep calm and keep going
The first thing to remember is that Britain’s exit is a detailed process that is only just beginning. Once the U.K. invokes Article 50, there will be a two-year process that has to happen before Britain is officially divorced from the EU. So an immediate panic is not needed.
Take this time to really educate yourself on the possibilities that could play out. You have time to do the research into the minutiae of investing that you’ve been putting off. Now is a good time to read through the available investment books that you’ve meant to read but just haven’t gotten done. Learn how investing and economics work, and you’ll better understand your options in the coming days.
Fools rushing in
Alexander Pope first made the point in 1709 about fools rushing in where angels fear to tread.
While it makes perfect sense to take time to reassess your tolerance for risk during these post-Brexit months, it doesn’t mean you need to make major adjustments to your investing portfolio. Doing so now may be making changes based on negative or inaccurate headlines in a reactionary media.
Now is not the time to make decisions based in emotional reactions. Brush up on your knowledge of investing in general and then make decisions from a more objective position.
Dig through the layers of complexity in global markets and you’ll probably come to the conclusion that there will be opportunities for growth and profit in the post-Brexit world.
Increased competition between the factions in Europe may very well lead to profitable opportunities for those investors who are willing to be patient and embrace the uncertainty of today for a chance at security tomorrow.