I’m a planner, I always have been. Perhaps it’s my pessimistic nature, but generally speaking, I assume things left to chance will turn out badly. For that reason I live by the credo “hope for the best, but plan for the worst.”


As you might imagine, threats like the coronavirus send people like me into action. Not because I believe this virus poses an imminent threat to my family but because I believe when it comes to things like this, you should always have a plan.


That’s why over a week ago I purchased a 10-pound bag of white rice, a 10-pound bag of dried beans and an ample supply of bottled water. As someone who is not prone to panic, I have to admit feeling a little silly pushing my cart through the Walmart aisles looking like I was preparing for a zombie apocalypse. With that being said, I do feel better knowing I have these items if I need them.


Having a fully equipped emergency kit is something that has been important to me for a long time. I still remember the aftermath of Hurricane Katrina in the summer of 2005. I was shocked about how quickly society could break down in a time of crises. I, like millions of others, watched helplessly as just days after the storm, looting, assaults, fires, rape and murder seemed to engulf the city of New Orleans. With whatever law enforcement that remained in the city unable to maintain order, individual residents were primarily on their own.


It was then that I became convinced that while it’s generally unlikely, the system we take for granted can break down. Even if it’s only for a brief amount time, any responsible person should have a plan for what to do in that worst-case scenario.


Much like I did with my survival kit, our team at Stewardship Capital has been preparing for the potential danger coronavirus could pose to the market. While we don’t believe this virus is going to lead to a full global recession, it still makes sense to have a plan in place to protect our clients’ hard-earned money. Just in case.


That’s why weeks ago we raised the levels of cash inside of our clients’ accounts to hopefully provide some protection from a potential market reaction to the illness. While it was certainly not fun to watch the S&P drop over 10% last week, knowing we had taken some precautions and were ready to take more if the situation called for it hopefully provided our clients a little bit of comfort.


Monday saw the largest one-day point jump in market history, providing some cause for optimism. However, Tuesday, after the Federal Reserve cut rates, the market gave back much of those gains. To be safe, we continue to carry excess cash in our clients’ accounts for the time being.


Please don’t read this column and conclude that taking some sort of action every time you feel afraid is the answer (unless that action is prayer). But at the same time, recognize that preparation for things that might never happen is not necessarily a sign of paranoia. It might actually be a sign of wisdom.


(Past performance is no guarantee of future results. Advice is general in nature and not intended for specific situations)


Luke Davis is the director of operations and compliance at Stewardship Capital in Independence.