Episode 8: Government Shutdowns: What does that REALLY mean for YOU and ME?

The U.S. government has shut down—again. Headlines are screaming panic, markets are twitching, and the noise is deafening. In this episode, we cut straight through the hype and break down what actually matters for your money, your investments, and your long-term plan.

Most investors make the same costly mistakes during events like this—panic selling, chasing cash, abandoning strategy, or freezing in fear. We explain exactly how to avoid those traps and why government shutdowns are political theater far more than economic crisis.

You’ll learn:
– How government shutdowns historically impact the market
– Why emotional investing destroys long-term returns
– Short-term vs. long-term mindsets during financial uncertainty
– Smart portfolio moves (and what NOT to do)
– How disciplined investors use volatility to build wealth
– Why sticking to a plan beats timing the market

We also connect this topic to real financial planning principles—including liquidity strategy, investment discipline, and behavior coaching—so you know exactly what to do next.

If you value clarity over noise and strategy over fear, you’ll get a lot from this conversation.

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Call Us:
To schedule a conversation, visit https://www.keystoneadvisors.com/contact or call 614-300-9501

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Disclosure: Information contained in this podcast is for entertainment and informational purposes only, and should not be considered as financial advice. Financial Planning and Advisory Services are offered through Prosperity Capital Advisors (“PCA”), an SEC registered investment adviser. Registration as an investment adviser does not imply a certain level of skill or training. Keystone Financial Group and PCA are separate, non- affiliated entities. PCA does not provide tax or legal advice.

Transcript

Announcer: 0:00

The financial huddle does not provide tax, legal, financial, or other professional advice. Listeners are encouraged to consult with their own advisors in these areas. Alright, everybody, huddle up. Plague ball z. This is the Financial Huddle. Ready?

Ed Beemiller: 0:14

Welcome, Huddlers and Huddler Nation. Back for our next episode of the Financial Huddle podcast. As usual, I got my cohort here. Mr. Ryan Fleming. Hey everybody. And Mr. Brian Manier. What's up, Eddie? Yes. All's good. All's good in C Bus. Today's topic is an extremely current event, and we thought uh we should kind of weigh in a little bit, and you know, as we do in all of our podcasts, promoting financial literacy and trying to make sense out of uh a lot of things that are happening in in the financial world or you know, economy or and you know what types of things should we be doing or not doing. And so in this case is looking at the government shutdown, how does this impact you, meaning you know, our clients, people out there, and should you be concerned about these current events?

Ryan Fleming: 1:10

How long is it gonna last?

Ed Beemiller: 1:11

Exactly. So with that, we'll we we just we'll start off with a couple little facts. You know, this is the stat time.

Brian Minier: 1:20

We're going stat time early this time.

Ed Beemiller: 1:21

Early, early and early and often. Um in some of these things, looking back, we're gonna take the last 50 years, there have been 21 government shutdowns. And the average period of that shutdown has been 8.25 days. Now one every other year. This was yeah, this was interesting. You know, the longest was 35 days, and this just happens to have occurred during the current president's first term. Oh so is that potentially how many days? 35. Okay. Is that potentially indicative of what we could be looking at here? Um, you know, but most of these have been extremely short term. And you know, with that being said, when something's very, very short term, human nature often gets involved, you know, when we're looking at investors and we're looking at clients, and we we tend to overreact. You know, not that any of us do, you know, in terms of that. Never. But, you know, I I kind of equate it to you know a lot of people like, well, what does a government shutdown mean? I mean, how's that impacting me? You know, going to, you know, here locally in Columbus, going to an Ohio State football game, you know, stadium's open, the fans are in their seat, and then the teams don't take the field. And they don't take the field because the coaches can't agree on a game plan. You know, that's the equivalent. That's the equivalent that we're dealing with here. It's not gonna go. You know, a couple parties can't agree to hop out of the state, but they couldn't do it. I'd hop out in point. Yeah, Ryan, why don't you jump in a little bit and tell us, you know, what we're recommending or you know, what all this really means.

Ryan Fleming: 3:08

Yeah, I just think it's uh we just want to make sure you adopt the right mindset, you know, in in in these times of turmoil or uneasiness um relative to government shutdowns. What I wanted to do, I I just wrote down a few short-term mindsets and the the risks associated with um dealing with the government shutdowns the wrong way. So I'm just gonna hop right into it. Uh you know, one of the one of the biggest risks that a lot of people take uh during a government shutdown is just panic selling, is what I would call it, you know, where they just they react to all the headlines and the buzz and they go into their portfolios and they just start selling everything to cash.

Ed Beemiller: 3:46

Human emotions.

Ryan Fleming: 3:47

Yeah, yeah. And and that leads into what we would what I would call like chasing safety. Um and what I mean by that is just you know moving too much money into cash or you know, overloading liquidity. Um, you know, and when you do that, you you miss these big rebounds sometimes. You know, I remember early on in my career, I remember the market had a big flash down, and then like that following Tuesday, it was the highest one-day rise in the market in the history of the stock market. You know, if you miss too many of those, that's gonna have a major impact. So, you know, a lot of people do that. We don't want to have that mindset of you know chasing too much safety. Um, sometimes people do the opposite. They freeze, um they freeze short term, waiting on the sidelines until things quote unquote feel right. Um again, I think Brian might speak to some of this as far as like why that long term is not a good thing, but a lot of times people freeze and they try to time it perfectly. And the last one that I wrote down as a short-term mindset during like a shutdown is um what I would call like over-rotating, or what that means is like selling equities, um, putting too much towards fixed income, or or you know, you know, when when yields are lower, you know, you you kind of over-rotate and you and you move too much to safety. So that that might make sense to most people, um, but there are some people out there that do that a lot. Yeah, one little headline, and boom, that you you you deviate from the plan.

Ed Beemiller: 5:08

Yep, yeah. And and the situation can be a little bit different depending upon each individual, because the people that are really truly financially impacted are those furloughed employees, or if you're a company, owner of a company that does a lot of contracting business with the federal government, you are seeing, you know, a furloughed employees, you're not getting paid. And and I've heard, once again, it could just be noise, but typically they would retroactive payback for those furloughed employees. I've I've heard noise coming out of the current administration saying they're not going to retroactive trying to force the other side, obviously, to settle and approve uh a budget moving forward.

Ryan Fleming: 5:50

Yeah, yeah, those things I just talked about are more for like just your your general population.

Ed Beemiller: 5:56

Yep. Yeah, but you're right. I was uh my wife and I just got back from an anniversary trip and the shutdown. Well, congrats, brother. Well, appreciate that. How many years? 26. That's amazing. Halfway to 52, maybe. That's right. 33 and counting. Yeah, you're you're the you're the elder. I'm the elder statesman.

Brian Minier: 6:14

But as we were returning, the the shutdown had already started, and we were very appreciative that the uh TSA employees were actually there working, knowing that they were not going to get get paid. So we were very thankful that they were there. So it's interesting, Ryan, as you're talking about some of these short-term mindsets, and this was very similar to some conversations I had, if you remember, last fall when the election was taking place. And I had a client that to your point, you get emotional. And I remember he was he said, I want to move a hundred thousand dollars out of my brokerage account, I want to move it into cash. And I begged him, don't do it. Like it this is a very sporadic emotional decision that you're making. And he's like, No, I'm gonna do it. And since the election, we we know the market has been very favorable. He's lost out on some growth. Oh, it's still in cash, yeah. It's still in cash, he still has not made that money. And so those uh quick emotional decisions can have an impact because you get emotional, you get scared. Yeah, and it was the same thing back in the fall with you know, whatever uh candidate you wanted, you were having concerns that the other one was going to get elected. So I want to speak more from a what does this mean long-term? What long-term approach should you take as you're thinking about what's happening in in the uh government right now? Some long-term mindsets that I think are important areas. The first one is recognizing shutdowns are more political than economic regime changes. They're good conversation pieces, they're not the basis of how you should determine how to invest your retirement. And that's a really important aspect. Same thing with the election. People are I got into this, what am I gonna do? Does it matter who's elected? They're conversation pieces, they're not a basis of how you should pick your retirement. Another one is staying committed to an investment plan or strategic asset allocation. If you work with us, we'd have different investment options, but what we stick to a lot of times is what is the evidence behind the investment? And do we talk more about active management or more sticking to the strategy that's going to follow what the overall market is doing? And so the basis of what how you pick is what do you think the market is going to do? And is this shutdown gonna really have an impact a year from now, five years from now, ten years from now? Yeah, and so that mindset I think is really important. Staying committed to that plan, using volatility as opportunities. Do you want to buy when it's low or do you want to buy when it's high? Low. Buy low, sell high, brother. What do people typically do? Opposite, yeah. The opposite, right? Because they get scared, they get out, oh, the market's good, I gotta get back into it. Yeah, Warren Buffett, the best at yeah, best at that, man. Right. And so when you have those opportunities, when let's and who knows? Right now, we're in the middle of the shutdown, the market is actually improving, which kind of weird. Who knows what will happen if the shutdown continues, who knows what will happen in the next week or so. But right now, the market seems to be pretty favorable. But if it does go down because of this, then maybe that's an opportunity to buy more. And then maintaining diversification across different asset classes, sectors, that is just wise, prudent ways to invest versus trying to put everything in a certain stock or a certain handful of stocks, because if if those don't cooperate with you, then your money is is at a lot at a lot more risk associated with it. So I think it's it's just a good basis, it's a good time period when this is going on to just ask yourself, what's my long-term plan? What am I what am I trying to do with this long term? And does this really impact that for the long term?

Ed Beemiller: 9:54

Yeah. And and you know, when we talk about if you've truly been impacted financially, as we talked about furlough employees, those types of things, it still goes back to that long-term plan. Because we we would say, all right, you should have three to six months of liquidity. Well, it's for those types of things when you have these life interruption events. Events that occur during your lifetime, yeah, that you don't have to, once again, you don't have to panic. Yeah, and hopefully for those employees, the government employees that were impacted by this, hopefully they had that three to six months or whatever it is established. And some of them probably know, they're probably conditioned that hey, if you're getting into this job, there the reality is gonna happen. Well, we just said it's going to happen. 21 shutdowns in the last in the last two years.

Brian Minier: 10:38

So you go into this knowing every couple years, there's a possibility.

Ed Beemiller: 10:43

There's a strong possibility.

Ryan Fleming: 10:44

And that's where we got the that bucket plan we talked about, you know, now, soon and later bucket, right? So if you got if you got your buckets organized right, you don't need to panic. Yeah, and and this is where having a a good coach, a good confidant, a good financial professional to hold you accountable, to to communicate what's going on, can keep people staying the course and not get emotional.

Ed Beemiller: 11:06

That's part of our jobs is yes, we're supposed to give good information, we're supposed to give strategies, but part of what we do is just keep our clients on track. We're kind of psychologists in a way, and in some regards, making sure that sometimes talk talking them off the roof, right? Right. Like, hey, no, don't jump. That's right. Don't jump. Just do what you're doing.

Brian Minier: 11:23

That's right.

Ed Beemiller: 11:24

Yeah, that's right. Yeah, so that that's really, you know, when we talk about this, is you know, stay the course. You know, this this is a quasi-political event that occurs, as we said, every couple years. Financial planning is a marathon, it's not a sprint. So don't overreact to things, stay the course, have regular communication with us, with your financial planners, with the professionals that you're working with. If you have uncertainty, you know, don't allow yourself and your emotions to take control of things. And, you know, that's part of that, like I said, is just ongoing regular communication, you know, with your financial professionals. And that's that's really the message we wanted to get out here today, is just to kind of give you a general overview of of this current event, uh, you know, government shutdown. And could it last another two weeks? Maybe. Could it be could it could it be over in a tomorrow? It's it's possible. Tortoise in the hair, man. Tortoise in the hair. You never know, but a lot of noise, but stay the course. Yeah, exactly. Exactly. So we're gonna end it there. Huddlers, as always, we greatly appreciate the time, whether you are listening or watching on YouTube. Uh, once again, if you can get that, spread the news. You know, let other people, friends, if you if you found this valuable, let them know what we're doing. You know, it's all gonna come back to what we're really trying to do. You know, our purpose here is information, financial literacy, talking about you know different topics in a very you know normal manner, yeah. Uh a manner in which people can understand.

Ryan Fleming: 13:11

When you're educated, you make better decisions. Yep, exactly.

Ed Beemiller: 13:14

And we want to help. There we go. Until next time. Cheers, everybody. Hundler's out.