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The Bad Year Playbook

Deciding well when the plan stops working.

Last updated: Shea Sanche, CFP® · Founder & Lead Advisor, Insight Planning

This guide helps you decide, on a good day, what you will do on a bad one.

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KEY INSIGHT FROM THIS GUIDE

A bad year is not a market problem. It is a decision problem. The loss is rarely what damages a financial life; the decision made in response to it is. And the person who will make that decision is not you. It is a version of you who is tired, narrowed, and short on time. You cannot consult that person right now, but you can leave them instructions.

THIS GUIDE IS FOR YOU IF

  • Your plan is working right now, and you have not had a reason to question it lately.
  • You have been through at least one difficult stretch before, with money, health, work, or family.
  • You are approaching or already in retirement, where a bad year costs more than it used to.
  • You own a business, where a bad year in the business and a bad year in the markets can arrive together.
  • You have noticed that you make different decisions when you are under pressure than when you are not.

THIS GUIDE IS NOT FOR YOU IF

  • You are in the middle of a bad year right now. This document is written to be built in advance. If you are in it, you need a conversation with someone who knows your situation.
  • You are looking for a market forecast, or a view on what happens next. There is none here, deliberately.
  • You want a specific investment strategy or a portfolio recommendation. That is a different conversation with a different scope.
  • You want a document that will make a bad year not hurt. Nothing does that.

Key Questions

Answers to the questions people actually ask.

Select any question to expand the answer.

What is a bad year plan?
A short written set of decisions made in advance about how you will respond when something goes wrong. It is not a market outlook, it is not a portfolio strategy, and it contains no forecasts. It exists because financial decisions made under stress are reliably worse than the same decisions made calmly, and the only time you can write one is while nothing is wrong.
What counts as a bad year?
Four kinds, not one. A market year, when investments fall and stay down long enough that it stops feeling temporary. An income year, when a job ends, a contract does not renew, or a business has a bad stretch. A health or family year, involving illness, a parent who suddenly needs care, a death, or a marriage that ends. And a business year, when a key employee leaves or a client concentration turns into a client loss. They arrive together more often than they arrive alone, and most people prepare only for the market one.
Why do good decisions break under pressure?
Your options narrow before your thinking does. Under real stress the mind stops generating alternatives, the clock speeds up, and doing something feels better than doing nothing. The part that catches thoughtful people is that you will not feel panicked. You will feel like you are finally seeing clearly. The certainty is the symptom.
Which decisions should come off the table in a bad year?
The one-way doors. Selling the family home or a property in a hurry. Starting a pension or a government benefit earlier than planned purely to feel safer. Unwinding a corporate or trust structure to simplify during a stressful period. Making a permanent commitment of money to an adult child in response to a crisis. The rule is not that these things never happen. It is that they never happen fast.
What should give first when money gets tight?
Set the order in advance rather than letting whatever is easiest to reach decide for you. For most people it runs: large discretionary spending, then timing, then cash and short-term reserves, then work, and the portfolio last by design. Reserves are not for emergencies so much as for avoiding forced decisions. Then name the one thing that does not give at all.
What is a standing instruction?
It is what you want said to you when you are not yourself, written now, in your own words. Some people want a specific fact, such as what their income floor actually is. Some want a person named. Some want a direct instruction, such as being told to wait ninety days. It carries more weight coming from the calm version of you than from anyone else, because it is not advice. It is your own instruction.

Related: How to Build Your Life File , and The Family Meeting Guide .

Your Next Steps

If this guide helped clarify the real decisions, the next step is coordinating those choices with your full planning context so execution stays calm and consistent.

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