This past week was one of the most volatile weeks ever in the history of the stock market, with the Dow Jones Industrial Average declining about 5 percent for the week.

I want to share a few thoughts with you on Thursday’s events, which saw the popular index decline close to 1000 points before recovering most of that within the span of about 20 minutes.

The day started off for me with a morning meeting in Bellevue, about 10 miles south of our offices in Kirkland, and before I headed back to the office, I stopped at the local bookstore to pick up a book and educate myself on the updated software I had purchased for my new laptop.  (That experience is a different story for a different day)

I love browsing bookstores, in fact when I first decided to write a book about 13 years ago, I would spend hours in bookstores, reviewing all the different investment and finance books. Much to my surprise, other than Bogle’s and Malkiel’s books, there were few, if any books available on the simple wisdom of index funds at that time, which gave me lots of energy to move forward with my project.

On Thursday morning, I took a quick peek at the finance/investing section in the bookstore, and was taken aback at the large quantity of books written on how to survive and thrive in a “new” era of investing.  These books were obviously written as a result of the nasty bear market we endured the past couple of years, promoting a new spin on how to become a better investor through new and improved economic analysis and investing strategies.

Later that day, I had a luncheon meeting, and walked out of the office with the Dow down about 340 points.  An hour later, with the market about to close, I caught CNBC blaring in the background, and noticed that the Dow was still down about 340 points, with the commentators yakking it up about whatever I wasn’t quite sure.

Only later did I realize that in that one hour the Dow Jones Average plummeted 1000 points, and it got me to thinking . . .

In today’s day of broadcast news and bookstores littered with authoritative “experts, it is a daunting challenge to ignore Wall Street and get on with your life.

I don’t say this lightly.  I share this with you from personal experience, not only in working with our clients at Soundmark Wealth Management, but in my own experiences with own portfolio.  Amid all the chaos of the past ten years, I probably haven’t spent more than 15 minutes a year reflecting on my portfolio, and yet I suspect my returns have significantly out-performed almost all investors with similar (stock/bond) allocations. Why?  Because I don’t let short term events impact my investment decisions.

This doesn’t mean I stick my head in the sand and ignore what is going on.  I am acutely aware of my financial plan, and what I need to be doing in my personal life to reach my financial goals.  It all starts with a commitment to integrate the three simple Coffeehouse principles into your life.

1. Develop a financial Plan

2. Allocate your assets accordingly

3. Capture the entire return of each asset class through low cost index fund.

I know one thing is certain – If I am to reach my short and long term financial goals, it won’t have anything to do with what is going on in Greece this week, and whether or not someone on a trading desk made a gigantic trade error.  All that stuff is irrelevant to me.  What is relevant, is that my allocation broadly reflects where I am at in my life, and I know what I need to be doing with my burn rate (expenses) to reach my financial goals.

(The first person to e mail me and tell me the mountain in the picture, and the approximate place where the picture was taken, will receive 2 free books!)