Don't Fear Bad Economic News

A few quick headlines for the day: "stocks end flat", "how oil's surge to $90 will hurt", "why the dollar keeps dropping". Those headlines actually aren't too depressing in the financial arena. I've seen worse. I believe many people react emotionally to financial news and they end up thinking they're powerless to do anything. I disagree. Plan, don't react.

Financial advisor Karl Johnson of La Canada, California, believes investors small and large can build wealth by laying out a wise financial plan and carefully sticking to it. Here are 3 ways to handle negative economic news:

#1 Think long term
#2 Be an independent thinker
#3 Get input from the right experts

For example, you hear home sales are falling and mortgages are going bad with high numbers of foreclosures. This can also present a future opportunity to invest in real estate. If the market dips, it's going to come back up. If people are about to lose their homes to foreclosure, save up your cash and Johnson believes in 3-4 years real estate will be a smart buy with profitable properties to rent for positive cash flow or flip for immediate profit.

So have a big picture. Don't worry about the short-term.

Investing and keeping a good financial strategy in play isn't about reacting to what happens. Instead, it's about following through with a solid plan and having facts at your disposal to understand long term gains and losses.

"Let's say it's raining outside," said Johnson. "I could complain and get wet or I could get an umbrella to hold over my head.

"My advice is don't pay too much attention to the news. Focus on what you're trying to accomplish and the steps needed to get you there. Seek out the right information to help you meet your financial goals."

Johnson went on to say the wealthiest people, and those who have made tremendous accomplishments, didn't do it on their own. They sought out valuable advisors and weighed the input they received.

So how do you choose a wise advisor? Interview them and listen while they talk if they express the reason they're in the business of being a financial advisor. If they're passionate in teaching others and helping others then you've chosen the right person even if they're short on experience. Are they honest? You may or may not be able to tell right away; however, listen closely if they talk about their desire to help others. If you're a small investor and they try to rush out of their meeting with you then they're not taking you seriously. More financial advisors with established companies are being told by their corporate offices to select more and more high net worth investors.

Make sure you choose someone who's delighted to assist you - even if you're just starting out with a small monthly investment in a conservative mutual fund. With the right plan and the right advice, you don't have to fear negative financial news.