What’s Really Happening and How to Protect Your Portfolio

Last Updated: October 27, 2025 (Day 24 of shutdown)

The Bottom Line Up Front

What you need to know in 60 seconds:

The government shutdown is now in its 24th day, and it’s different from past shutdowns in one critical way: Food stamp benefits (SNAP) will stop for 42 million Americans starting November 1st. This creates a $12 billion hole in consumer spending every month it continues.

Our best estimate: The shutdown will last 6-8 weeks total, markets will drop another 4-6% from current levels, then recover once it’s resolved. If you’re a long-term investor (5+ years), this is likely a buying opportunity. If you need money in the next 12 months, you should already be defensive.

What’s driving stock market weakness:

• 70% is the food stamp cutoff hurting consumer spending
• 20% is uncertainty about how long this lasts
• 10% is everything else

It’s NOT primarily about federal job losses (only 5,000-15,000 jobs, which is tiny), but about 42 million people losing $200/month in grocery money.

Table of Contents

1. What’s Different About This Shutdown
2. Six Ways This Could Play Out
3. What Should I Do With My Money?
4. When Will Markets Recover?
5. Is This 2008 All Over Again?
6. Practical Portfolio Changes
7. Common Questions Answered
8. Key dates to watch
9. How to monitor the situation
10. Five rules to get through this
11. Final Thoughts
12. Stay Updated.

1. What’s Different About This Shutdown

Past Shutdowns vs. Now

Previous shutdowns (1995, 2013, 2018-19):

• Federal workers sent home temporarily
• Everyone got back pay when it ended
• Essential services mostly continued
• Food stamps kept flowing
• Markets barely noticed

This shutdown (2025):

• Federal workers still sent home (will get back pay)
• Food stamps STOPPED for 42 million people ← This is the big one
• 5,000-15,000 federal workers may be permanently laid off
• Already 24 days (approaching the 35-day record from 2018-19)

Why Food Stamps Matter So Much

The Math:

• 42 million Americans rely on SNAP (food stamps)
• Average benefit: ~$200 per person per month
• Total lost spending: $8-12 billion per month
• These people spend 100% of their benefits immediately (unlike wealthy people who might save money)

Where it hits hardest:

• Grocery stores (especially discount chains like Dollar General)
• Fast food restaurants
• Walmart, Target
• Any business that serves lower-income customers

Why this matters for stocks: When 42 million people suddenly have $200 less to spend, companies that sell to them see sales drop. Lower sales = lower earnings = lower stock prices.

The Three Things That Determine What Happens Next

1. How Long Does It Last?

• Short (< 4 weeks): Unlikely now, we’re already at 24 days
• Medium (4-8 weeks): Most likely (our base case)
• Long (8+ weeks): Possible but less likely

2. How Long Are Food Stamps Cut Off?

• 1 month (November only): Base case
• 2 months (November + December): Worse case
• 3+ months: Very bad case

3. How Many Federal Workers Get Permanently Laid Off?

• Less than 5,000: Courts blocked it
• 5,000-15,000: Most likely (partial success)
• More than 15,000: Proves the government can be dramatically downsized

Important: The job losses don’t directly hurt the economy much (it’s only 0.01% of all jobs), but they signal whether shutdowns will become a regular thing going forward.

2. Six Ways This Could Play Out

Scenario 1: Quick Resolution (25% chance)

The Good News Case

What happens:

• Thanksgiving week pressure forces a deal (by November 27)
• Food stamps restored quickly
• Shutdown lasts ~4 weeks total
• Federal workers laid off: Minimal (courts block it)

Market impact:

• Stocks: Rally 2-4% when announced
• Your portfolio: Gets back most of what it lost

What to do:

• Don’t sell in panic
• This would be a buying opportunity that resolved quickly
• Patient investors win

Scenario 2: Our Best Guess (30% chance)

The Most Likely Case

What happens:

• Shutdown lasts 6-8 weeks (through mid-December)
• Food stamps cut off for November only
• Some federal workers laid off (5,000-15,000)
• Holiday season creates pressure for deal

Market impact:

• Stocks: Drop 4-6% total from today’s levels
• S&P 500 falls from ~5,350 to ~5,050-5,150
• Discount retailers (Dollar General, Dollar Tree) get crushed: -15% to -25%
• Defensive stocks (healthcare, utilities, food companies) hold up better

What to do:

• If you’re 100% in stocks: Move 8-10% to bonds or cash
• If you’re retired/near retirement: Already be defensive (40-50% in stocks max)
• Set a mental “buy list” of quality stocks you want to own at lower prices
• Example: If Microsoft drops below $350, add to your position

Recovery timeline:

• Deal announced: Stocks jump 3-5% immediately
• Full recovery: 3-6 months

Scenario 3: Gets Worse (10% chance)

The Bad Case

What happens:

• Shutdown lasts 6-8 weeks
• Food stamps cut off for November AND December (two months)
• More federal workers laid off (15,000-20,000)

Market impact:

• Stocks: Drop 6-9% total
• S&P 500 falls to ~4,900-5,050
• Recession becomes more likely (35-40% chance)
• Consumer stocks get hammered

What to do:

• Move to 50-55% stocks (if you’re normally 60-65%)
• Increase bonds and cash
• Focus on quality: Companies with no debt, steady profits
• Examples: Johnson & Johnson, Procter & Gamble, Microsoft, Coca-Cola

Recovery timeline:

• 6-9 months to get back to current levels

Scenario 4: Extended Crisis (4% chance)

The Ugly Case

What happens:

• Shutdown exceeds 60+ days (through January)
• Food stamps cut off 2-3 months
• Lots of federal workers laid off (15,000-25,000)
• Recession likely

Market impact:

• Stocks: Drop 9-13% total
• S&P 500 falls to ~4,700-4,900 (bear market threshold)
• Many retailers face serious trouble
• Some regional banks may fail

What to do:

• Get defensive: 45-50% stocks maximum
• Move to highest quality companies only
• Increase savings/cash to 5-10% of portfolio
• Don’t panic sell, but don’t be a hero either

Recovery timeline:

• 12-18 months

Scenario 5: Disaster (1% chance)

The Worst Case

What happens:

• Shutdown exceeds 75+ days (into February/March)
• Food stamps cut off 3-4 months
• Debt ceiling crisis happens simultaneously
• Credit rating agencies downgrade US debt
• Recession certain

Market impact:

• Stocks: Drop 15-20% (full bear market)
• S&P 500 falls to ~4,300-4,600
• Financial system stress (but no 2008-style collapse)

What to do:

• Maximum defense: 35-40% stocks
• Only own the absolute safest companies
• Have cash ready to buy at once-in-decade prices
• Think “Great Recession” not “normal correction”

Recovery timeline:

• 18-24+ months

Scenario 6: False Alarm (25% combined)

It Resolves Very Quickly

This combines the various “better than expected” outcomes. Maybe Thanksgiving creates enough pressure, or courts block everything, or politicians blink.

What to do:

• If this happens, you’ll wish you’d bought more
• Don’t chase—markets will rally 5-10% in days
• Be satisfied if you held steady

3. What Should I Do With My Money?

If You’re Young (20+ Years Until Retirement)

Bottom line: Do almost nothing.

This is noise for you. In 20 years, this will be a tiny blip. Every crisis looks like the end of the world while you’re in it, then seems obvious in hindsight.

Action plan:

1. Keep contributing to your 401(k)/IRA (you’re buying stocks on sale)
2. If you have cash on the sidelines, consider buying if S&P drops to 5,000
3. Don’t check your account every day (it’ll just stress you out)
4. Remind yourself: You’re decades away from needing this money

What NOT to do:

• Sell everything and go to cash (you’ll lock in losses and miss the recovery)
• Stop contributing to retirement accounts (worst time to stop)
• Try to time the market perfectly (you’ll probably get it wrong)

If You’re Mid-Career (10-20 Years Until Retirement)

Bottom line: Get slightly more conservative, but stay mostly invested.

You have time to recover from this, but not unlimited time. Now’s the time to make sure your portfolio isn’t too aggressive.

Check your allocation:

Within your stock allocation, tilt toward quality:

Reduce:

• Small risky companies
• Tech stocks with no profits
• Anything with lots of debt
• Retailers (especially discount chains)

Increase:

• Big, stable companies (Microsoft, Apple, Google)
• Healthcare (Johnson & Johnson, UnitedHealth)
• Consumer staples (Procter & Gamble, Coca-Cola)
• Utilities (electric companies)

Shopping list (if prices drop another 5-10%):

• Microsoft under $350
• Apple under $180
• Johnson & Johnson under $145
• Procter & Gamble under $140

If You’re Near Retirement (5-10 Years Out)

Bottom line: Get defensive now if you haven’t already.

You don’t have time to recover from a big loss. Your goal is preserving what you’ve built.

Target allocation for your situation:

• 50% stocks (maximum)
• 40% bonds
• 10% cash/stable value

Within stocks, be VERY selective:

• Only own things you’d hold through a recession
• Focus on dividends (steady income even if price drops)
• Avoid anything risky or speculative

Dividend Champions to consider:

• Johnson & Johnson (2.9% dividend yield)
• Procter & Gamble (2.4% yield)
• Coca-Cola (3.1% yield)
• 3M Company (5.8% yield)
• AT&T (6.5% yield, but has risks)

Bonds:

• Keep it simple: Total bond market index fund
• Or: Treasury bonds (ultra-safe, government guaranteed)
• Duration: 5-7 years is good middle ground

If You’re Retired

Bottom line: You should already be defensive. If not, fix that now.

The rule of thumb: If you need money in the next 3 years, it shouldn’t be in stocks at all.

Suggested allocation:

• 30-40% stocks (only very safe ones)
• 50-60% bonds
• 10-15% cash

Create a “bucket” system:

Bucket 1 (Immediate needs – next 2 years):

• High-yield savings account
• Money market fund
• Short-term bonds (1-2 years)
• Goal: Never have to sell stocks at a bad time

Bucket 2 (Medium-term – years 3-7):

• Bond funds (total bond market or intermediate-term)
• Dividend-paying stocks (the most stable ones)
• Goal: Income plus modest growth

Bucket 3 (Long-term – years 8+):

• Stocks for growth (you might live 30+ years in retirement)
• Focus on quality: Microsoft, Johnson & Johnson, Berkshire Hathaway
• Goal: Keep up with inflation long-term

Critical rule:

• If you need to take money out, take it from Bucket 1
• Never sell stocks when they’re down unless you have no choice
• Refill Bucket 1 from Bucket 2 when markets recover

4. When Will Markets Recover?

Historical Recovery Times

Past government shutdowns:

• 1995-96: Markets flat during, recovered immediately
• 2013: Back to normal in 2-3 months
• 2018-19: Markets actually UP during shutdown (looking past it)

But this one is worse because of the food stamp cuts.

Recovery Timeline by Scenario

What “Recovery” Looks Like

Day 1 after deal announced:

• Stocks jump 3-8% (everyone relieved)
• You’ll feel like you should have bought more

Week 1:

• Continued rally, maybe another 2-4%
• News coverage becomes positive
• Investors pat themselves on back

Months 2-3:

• Markets get choppy again
• People realize the damage was real
• Some stocks go back down a bit
• This is normal—ignore it

Months 3-6:

• Gradual recovery continues
• Economy shows it’s healing
• Markets grind higher
• Back to old highs eventually

The pattern is ALWAYS the same:

1. Crisis happens
2. Everyone panics
3. Prices drop
4. Crisis resolves (they always do)
5. Markets recover
6. People say “I should have bought at the bottom!”

5. Is This 2008 All Over Again?

No. Here’s Why:

2008 Financial Crisis:

• Banks were failing (Bear Stearns, Lehman Brothers collapsed)
• Credit markets froze (nobody could borrow money)
• Housing market collapsed (millions of foreclosures)
• Unemployment hit 10% (massive job losses)
• Stock market dropped 50%+ (retirement accounts cut in half)
• Recovery took 5+ years

2025 Government Shutdown:

• Banks are healthy (well-capitalized, lots of reserves)
• Credit markets working (stressed but not frozen)
• Housing market solid (inventory low, demand steady)
• Unemployment still only 4.0% (very low)
• Stock market down 5-10% max (correction, not crash)
• Recovery will take 6-18 months

What IS Similar

Both are scary when you’re living through them. That’s it.

What This IS More Like

2011 Debt Ceiling Crisis:

• Political dysfunction
• US credit rating downgraded
• Markets dropped ~15%
• Felt like end of the world
• Recovered fully in 6 months
• People who sold regretted it

2018-19 Government Shutdown + Fed Fears:

• Longest shutdown in history (35 days)
• Markets dropped 20% in late 2018
• Everyone panicked
• By mid-2019, markets at new all-time highs
• People who sold at the bottom kicked themselves

The Pattern

Crisis → Panic → Recovery happens over and over:

• 1987 crash: Recovered in 2 years
• 1990-91 recession: Recovered in 18 months
• 1998 Russia/LTCM crisis: Recovered in 6 months
• 2000-2002 tech bubble: Took 3 years (this was real)
• 2008-09 financial crisis: Took 5 years (this was real)
• 2011 debt ceiling: Recovered in 6 months
• 2015-16 China fears: Recovered in 9 months
• 2018 shutdown/Fed: Recovered in 6 months
• 2020 COVID: Recovered in 6 months (fastest ever due to stimulus)
• 2022 inflation fears: Down 25%, recovered in 12 months

The lesson: Stay invested. Don’t panic sell. Buy quality on dips.

6. Practical Portfolio Changes

For Your 401(k) / IRA

If you’re currently in:

• Target Date Fund (like “Target 2040”): These automatically rebalance. Do nothing.
• S&P 500 Index Fund only: Consider moving 10-15% to a bond fund
• 100% stocks of any kind: Move 10-20% to bonds unless you’re under 35

Specific moves:

Conservative adjustment:

• Take 10% of your stock funds
• Move to: Total Bond Market Index or Intermediate-Term Treasury

Moderate adjustment:

• Take 15% of your stock funds
• Move to: 10% bonds, 5% money market/stable value

Aggressive adjustment (if you’re really worried):

• Take 20-25% of your stock funds
• Move to: 15% bonds, 10% cash
• Only do this if you’re within 10 years of retirement

For Your Brokerage Account (Individual Stocks)

If you own risky/speculative stocks:

Sell or Reduce:

• Unprofitable tech companies
• Dollar General, Dollar Tree (directly in the line of fire)
• Small-cap stocks with debt
• Regional banks in the DC area
• Commercial real estate REITs
• Anything you wouldn’t want to hold through a recession

Keep or Buy:

• Microsoft, Apple, Google (fortress balance sheets)
• Johnson & Johnson, Procter & Gamble (defensive)
• Walmart, Costco (benefit from trade-down)
• Utilities (essential services, dividends)
• Berkshire Hathaway (Buffett’s safe haven)

Quality checklist (does your stock have these?):

• ✅ Profitable (positive earnings)
• ✅ Low or no debt
• ✅ Steady business (not dependent on economy)
• ✅ Been around 25+ years
• ✅ Pays a dividend (nice bonus but not required)

If you answer “no” to more than 2 of these, consider selling.

Sample Portfolio for Different Ages

Age 30 (Aggressive Growth):

70% US Stock Index Fund
20% International Stock Index Fund
10% Bond Index Fund

Age 45 (Balanced):

50% US Stock Index Fund
15% International Stock Index Fund
30% Bond Index Fund
5% Cash

Age 60 (Conservative):

35% US Stock Index (focus on dividends)
15% International Stock Index
40% Bond Index
10% Cash/Money Market

Age 70 (Retired):

25% US Stock Index (dividend focus)
10% International Stock Index
50% Bond Index
15% Cash/Money Market

7. Common Questions Answered

“Should I sell everything and go to cash?”

No. Here’s why:

What happens if you go to cash now:

1. You lock in your losses (they become permanent)
2. You have to decide when to get back in (really hard)
3. You’ll probably get it wrong (most people do)
4. You’ll miss the recovery (biggest gains happen fast)

History shows:

• The best market days happen right after the worst ones
• Missing the 10 best days over 20 years cuts your returns in half
• People who sell in a panic almost never get back in at the right time

Better approach:

• Reduce stock exposure by 10-20% if you’re worried
• Keep the rest invested
• Buy more quality stocks if prices drop further

“Should I stop contributing to my 401(k)?”

Absolutely not. This is the worst time to stop.

Think about it:

• Your contributions buy MORE shares when prices are lower
• Your company match is free money (never turn that down)
• You’re dollar-cost averaging automatically

Example:

• Before: $100 buys 1 share at $100
• During crisis: $100 buys 1.18 shares at $85
• After recovery: Those 1.18 shares are worth $118

You just made 18% extra by buying during the dip!

“What if it gets worse than you predicted?”

Then I’ll update this guide. But here’s the thing:

If I’m wrong and it gets much worse:

• Markets drop 20%+ (full bear market)
• Takes 18-24 months to recover
• You’ll still be glad you didn’t panic sell

Historical perspective:

• Average bear market: -35% drop, 15 months to recover
• We’ve had 12 bear markets since 1945
• All 12 recovered and went on to new highs
• The S&P 500 is up 11,000% since 1945 despite all of them

The question isn’t “Will we recover?” The question is “Can I handle the pain while we do?”

If the answer is “no,” you’re too aggressive and should move to bonds/cash NOW.

“How do I know when to buy?”

The honest answer: You don’t. Nobody does.

But here’s a strategy:

Set price targets now for stocks you want to own:

Example “Buy List”:

How to use this:

• Set limit orders at these prices
• If they hit, you buy automatically
• Don’t wait for the “perfect bottom” (you’ll never catch it)
• Buy in chunks (1/3 at each level if you have cash)

Warren Buffett’s approach: “Be fearful when others are greedy, and greedy when others are fearful.”

Translation: When everyone’s panicking and CNBC is showing red screens all day, that’s when you should be buying.

“What about gold?”

Gold is a legitimate hedge, but don’t go overboard.

Pros:

• Goes up when people panic
• Protects against government dysfunction
• Historically safe in crises

Cons:

• Doesn’t pay dividends or interest
• Can be volatile
• Might underperform if crisis resolves quickly

Reasonable allocation:

• 5% of your portfolio in gold (via GLD ETF or gold mining stocks)
• 10% if you’re really worried about government dysfunction continuing
• Don’t go above 15% (that’s getting extreme)

“Should I refinance my mortgage / take money out of home equity?”

Mortgage rates are still relatively high (6-7%), so probably not unless you’re in trouble.

DO NOT:

• Take cash out of your home to “invest in the stock market dip”
• That’s called “leveraging” and it’s really dangerous
• If stocks drop more, you’ve lost money AND added debt

DO:

• Make sure you have 3-6 months of expenses in savings
• Pay down high-interest debt (credit cards)
• Build emergency fund before investing more

“What if I need to take money out of my portfolio soon?”

Timeline matters:

Need money in < 6 months:

• Move it to cash/savings NOW
• Don’t gamble with money you need soon
• Better to miss gains than need to sell at the bottom

Need money in 6-12 months:

• Move half to cash, leave half invested
• You have some time but not much
• Conservative is better than sorry

Need money in 1-3 years:

• Keep 50-60% in stocks if you’re comfortable
• Rest in bonds and some cash
• You have enough time for modest recovery

Need money in 3+ years:

• Stay mostly invested (60-70% stocks)
• You have time to ride this out
• Short-term drops don’t matter for you

“Are we heading for a recession?”

Maybe. Current odds: ~40-50% for our base case scenario.

What causes recessions:

• Consumer spending drops (happening due to food stamp cuts)
• Business investment freezes (happening due to uncertainty)
• Credit markets seize up (NOT happening)
• Mass layoffs (NOT happening except in government)

This could cause a “mild recession”:

• GDP contracts slightly for 2 quarters
• Unemployment rises from 4.0% to 4.5-5.0%
• Lasts 6-9 months
• Not a disaster, just slower growth

This is NOT going to cause a “severe recession”:

• Banks are healthy
• Consumers (overall) have money
• Corporate profits are good
• Housing market is stable

If we do get a recession:

• Markets typically bottom 6-9 months before the economy does
• By the time you “know” it’s a recession, the worst is over for stocks
• This is why “waiting for clarity” means you miss the recovery

“Should I invest in international stocks instead?”

Maybe a little more, but don’t abandon US stocks.

The argument for international:

• US political dysfunction is the problem
• Europe, Asia, etc. are more stable right now
• International stocks are cheaper (lower valuations)
• Diversification is good

The argument against going heavily international:

• US companies are the most profitable in the world
• Many US companies (Microsoft, Apple, Google) earn half their money internationally anyway
• Currency risk (dollar fluctuations) adds volatility
• Past 15 years, US stocks have crushed international

Reasonable approach:

• If you’re 100% US stocks: Move 10-15% to international
• If you’re already 20-30% international: Stay there
• Don’t go above 40% international (that’s overweighting)

Simple fund:

• Vanguard Total International Stock Index (VXUS)
• Or: iShares MSCI EAFE ETF (EFA) for developed markets only

“What about crypto / Bitcoin?”

Not relevant to this analysis. Crypto is a speculation, not an investment strategy for this crisis.

Quick take:

• Bitcoin might go up (people flee to alternatives)
• Bitcoin might go down (people need cash for expenses)
• It’s a coin flip, not a hedge
• If you own crypto, keep it under 5% of your portfolio
• If you don’t own it, don’t start now as a crisis hedge

“My financial advisor says something different. Who’s right?”

Your advisor knows your situation; this generic analysis does not.

Good reasons your advisor might disagree:

• They know your age, goals, risk tolerance
• They know what you own already
• They might be more optimistic or pessimistic than me
• Different advisors have different strategies (all can work)

Red flags that your advisor might be wrong:

• They’re trying to time the market perfectly (“sell everything now, we’ll get back in at the bottom”)
• They’re pushing you toward expensive actively managed funds
• They’re making major changes weekly (overtrading)
• They can’t explain their reasoning simply

What to do:

• Read this guide
• Talk to your advisor
• Ask them to explain their reasoning
• Make sure it makes sense to you
• Trust your gut

Remember:

• No one knows the future
• Different approaches can both be right
• The worst thing is doing nothing when you should be defensive
• The second-worst thing is panicking and selling everything

8. Key Dates to Watch

Here’s when things might change:

November 17-24 (Thanksgiving Week):

• Most likely time for a deal
• Holiday travel creates pressure
• Black Friday retail season
• If no deal by Thanksgiving, we’re heading to extended scenario

December 8-15 (Holiday Season):

• Second chance for deal
• Christmas travel pressure
• If no deal, we’re in serious trouble

December 17-18 (Federal Reserve Meeting):

• Fed likely cuts interest rates by 0.25-0.50%
• This helps stocks a bit
• But Fed can’t fix political problems

January 1-15, 2026 (Debt Ceiling Crisis):

• If shutdown goes this long, debt ceiling becomes an issue
• Treasury runs out of money
• Could force resolution OR make crisis worse

9. How to Monitor the Situation

Don’t obsess, but check in weekly:

Good sources:

1. Google News: “government shutdown” (5 minutes of reading)
2. Yahoo Finance: Check S&P 500 level (1 minute)
3. This guide: I’ll update it if scenarios change dramatically

Specific signals to watch:

Positive signals (things getting better):

• ✅ Bipartisan meeting announced
• ✅ Senate vote shows Democrats might compromise
• ✅ Food stamps get emergency funding
• ✅ Courts block most federal layoffs
• ✅ S&P 500 rallies back toward 5,400

Negative signals (things getting worse):

• ⚠️ December food stamps also suspended
• ⚠️ More than 10,000 federal workers laid off
• ⚠️ Credit rating agencies announce review
• ⚠️ S&P 500 drops below 5,000
• ⚠️ Consumer confidence drops below 60

Neutral (just noise):

• Daily political rhetoric
• Single-day stock market moves
• Pundit predictions on cable news

How often to check your portfolio:

• Under 50: Monthly
• 50-65: Weekly
• Over 65: Weekly, but don’t make changes more than monthly

10. The 5 Rules to Get Through This

Rule 1: Don’t Panic Sell

Selling when scared almost always leads to worse outcomes. You lock in losses and miss the recovery.

Instead: Get defensive gradually if needed, but stay mostly invested.

Rule 2: Focus on Quality

When times are uncertain, own companies that can survive anything:

• Strong balance sheets (low debt)
• Steady profits
• Essential products/services
• Long history

Examples: Microsoft, Johnson & Johnson, Procter & Gamble, Coca-Cola, Berkshire Hathaway

Rule 3: Keep Perspective

Remember:

• This WILL end (all shutdowns end)
• Markets WILL recover (they always do)
• In 5 years, this will be a blip

Ask yourself:

• Will this company exist in 10 years? (If yes, hold it)
• Do I need this money in the next 2 years? (If no, don’t sell)
• Would I buy more at these prices? (If yes, hold what you have)

Rule 4: Have a Plan and Stick to It

Decide now:

• What allocation you want (% stocks vs. bonds)
• What price you’ll buy at (set targets)
• What you’ll do if it gets worse (have a plan)

Then execute your plan mechanically:

• Don’t let emotions override your strategy
• Don’t make it up as you go
• Trust the process

Rule 5: Think Long-Term

10-year perspective:

• Will you remember this crisis? Barely.
• Will your portfolio have recovered? Absolutely.
• Will you regret panic selling? Probably.

The investors who win:

• Stay disciplined
• Buy quality on dips
• Ignore the noise
• Think in decades, not days

11. Final Thoughts: A Letter to My Past Self

If I could go back to past crises and give advice to myself when I was panicking, here’s what I’d say:

During the 2008 crash: “I know it feels like the world is ending. It’s not. Buy stocks. You’ll be up 300% in 10 years.”

During the 2011 debt ceiling: “The US won’t default. This is politics. It recovers in 6 months.”

During the 2018 shutdown: “This is the longest shutdown ever and it feels terrible. Markets are at new highs 6 months later.”

During the 2020 COVID crash: “I know the world shut down. Buy stocks. This recovers faster than any crash in history.”

Right now in 2025: “This is scary. Food stamps being cut is real. But it ends. The government reopens. Food stamps restore. Life goes on. The S&P 500 is at new highs 12-18 months from now. Your kids will ask you ‘Remember that shutdown?’ and you’ll barely remember the details.”

The pattern is always the same:

1. Crisis happens
2. It feels like the world is ending
3. You have to make decisions with incomplete information
4. It’s terrifying
5. Eventually it ends
6. Markets recover
7. Life goes on
8. You’re glad you didn’t panic

This time is not different.

Stay calm. Stay invested. Focus on quality. Think long-term.

You’ve got this.

12. Stay Updated

We will update this guide if the situation changes materially. Check back weekly for updates.

Current status (as of Day 24):

• ✅ Base Case (Scenario 2) still most likely
• ⚠️ Watching for Thanksgiving breakthrough or extension
• 📊 Markets unaffected so far.

Last updated: October 27, 2025

Disclaimer: This is educational information, not personal financial advice. Your situation is unique. Consider consulting a financial advisor who knows your full picture before making major changes. Past performance doesn’t guarantee future results. All investing involves risk including loss of principal. But honestly? The principles here are solid. Stay calm. Stay invested. Focus on quality. Think long-term. That works in every crisis.