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Back-to-School Jitters? Investing Lessons Just Might Help

Written by Judy McKinnon | Published on September 9, 2020

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Update: As kids and teachers head back to school again, we took a moment to look at how far things have come. On the surface, the situation may not seem all that different than last fall — the world is still an uncertain place — but perhaps one thing that has changed (we hope!) is that we've all grown a little wiser, more confident and, yes, even a little bit more hopeful.

So, here's a shout out to returning students and their parents this school year. From managing emotions, embracing technology and finding what's right for you, we hope some of these tips are helpful, and we wish you all a happy and safe school year. - The Inspired Investor team

Each year, back to school brings with it a mix of excitement, fear and uncertainty for everyone involved. This year, with the added challenges posed by COVID-19, students, teachers and caregivers are facing a whole host of new considerations.

Facing unknowns is something investors know well. With the new, not-quite-the-norm, school year underway, here's a cheat sheet of tips for back-to-schoolers borrowed from the investing classroom.

1. Knowledge is power

Education, of course, is all about learning — it just usually centres on things like science, math, languages and the arts. This school year, much of the learning so far is focused on the logistics of how education will work amid the pandemic-related restrictions. What will classrooms look like? How will everyone remain safe? While there may be no concrete answers, arming yourself with as much information as possible can help you prepare for what lies ahead. For many self-directed investors, continual learning is ingrained — whether it's researching new investing concepts, new strategies or gathering as much information as possible to make the best decisions for you. In both situations, finding sources you trust is key. Check out A Fact Checker's Guide to Misinformation for tips on how to find what you need.

2. It's going to be emotional

Let's face it, uncertainty often leads to emotional reactions, ones like anticipation, fear, surprise, anger or joy come to mind. With all the unknowns surrounding this year's school environment, it's no surprise those emotions are quick to surface when the back-to-school topic arises. You'd be hard pressed to find an investor who hasn't been on the same emotional roller coaster thanks to the ups and downs of the market. Keeping the big picture in mind, understanding that emotions will be at play and arming yourself with as much information as possible (see #1) can help keep emotions in check. Read David Chilton's take on emotions in How the Wealthy Barber Manages Emotions.

3. There's no one-size-fits-all

As far as back to school is concerned, especially this year, what works for one family or teacher may be totally different from what works for others. The same goes for schools, or even entire school boards. A big part of figuring out what's right for individuals comes down to risk assessment, which may help determine, for example, the choice between online learning, in-class learning or a hybrid model — or, in the case of investors, which investments are right for you. Understanding that there's no one-size-fits-all model can help when making decisions of any kind. Most important is doing what's right for you.

4. Embrace technology

On top of the new supplies added to the traditional back-to-school list — think masks and hand sanitizer — technology is set to play an increased role for many in the education system. Whether it's helping facilitate remote learning, keeping teachers in touch with parents (hello Zoom parent-teacher interviews!) or limiting the back-and-forth of physical homework sheets or workbooks, expect some type of technology to be involved. It may be a different way of doing things, but as many do-it-yourself investors will attest, technology can make things so much easier. Having resources at your fingertips can save time, bring peace of mind and ultimately help make decisions that are best for you.

RBC Direct Investing Inc. and Royal Bank of Canada are separate corporate entities which are affiliated. RBC Direct Investing Inc. is a wholly owned subsidiary of Royal Bank of Canada and is a Member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund. Royal Bank of Canada and certain of its issuers are related to RBC Direct Investing Inc. RBC Direct Investing Inc. does not provide investment advice or recommendations regarding the purchase or sale of any securities. Investors are responsible for their own investment decisions. RBC Direct Investing is a business name used by RBC Direct Investing Inc. ® / ™ Trademark(s) of Royal Bank of Canada. RBC and Royal Bank are registered trademarks of Royal Bank of Canada. Used under licence.
© Royal Bank of Canada 2020.

The views and opinions expressed in this publication are those of the writer. This article is for your general interest and does not necessarily reflect the views and opinions of RBC Direct Investing. Furthermore, the products, services and securities referred to in this publication are only available in Canada and other jurisdictions where they may be legally offered for sale. If you are not currently resident of Canada, you should not access the information available on the RBC Direct Investing website.

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