Aug 8, 2011 7:21 PM by Melissa Hawkes
You may be wondering how the credit downgrade will affect your finances. Lafayette financial advisers said there's no reason to panic.
Standard and Poor's downgrade of the US debt rating didn't come as a surprise to Edward Jones Financial Adviser Shane Goff. He said short term, it won't impact your pocketbook much.
Goff said, "long term we could see mortgage rates go up a little bit, but don't expect them to go up a whole lot."
The announcement Friday made for a busy Monday for most financial advisers like CEO of Ahren's Investment Partners, Andrew Ahrens, answering phone calls and watching the stock market steadily decline.
He has this advice for his clients--"don't follow the herd. Just sit back. The time to make changes is when the market comes back up. Everyone sells at the bottom, and you don't make money when you do that."
Goff said, "the stock market declining is really people not understanding fully what it means.
If that doesn't calm your nerves, then you should sit down and talk with whomever handles your finances. Goff said especially your 401K plan.
He explained, " making sure they are diversified. Diversity does not guarantee positive results, but having a diverse portfolio will help you weather some of the volatility we are seeing in the stock market."
As for making big purchases like buying a house or car, Ahrens said, "don't buy anything where you don't have enough savings in reserve to pay for it, just in case you find yourself without an income."