We’re all surprised at the speed of changes the coronavirus has brought in our lives. Working from home, school closures, and social distancing have become our new norms. Stock markets have fallen in to a bear market in less than a month. Uncertainty related to COVID-19 grows daily, as we all know the amount of new cases are destined to rise.
It can be hard to find positives through the barrage of more disappointing news each day. But there are steps you can take to prepare your portfolio during this bear market. In today’s episode, we share 7 tips to help ease your worries during this challenging time.
We all feel nervous about stock market drops. Despite bear markets happening an average of every 6-7 years, it never gets easier to handle emotionally. During these times, investment behavior determines your returns more than the investments themselves.
Having an investment plan beforehand adds discipline to your decisions amidst the turmoil. If you’re questioning what you should do, then referring back to your plan will remind you of your highest priorities.
When you think about it, you only really have 3 options to choose from.
With the first one, being much more damaging long-term than the others. To cope with this, we’ve put together seven things you can do to help ease your worry so you are better prepared to make more sound financial decisions.
Cornoavirus concerns continue to impact the financial markets, as have all the numberless crises that have gone before it.
While the potential human and economic effects are very unsettling, what actions should a prudent investor take given this new development?
Short Video Recap Here: https://youtu.be/Wsy6OTuY-yI
It remains impossible to predict when and how this problem will be resolved. Likewise, it is impossible to know when and how the markets will anticipate (or react to) such a resolution.
In this episode of the Financial Symmetry show, hosts Chad Smith and Mike Eklund, evaluate all the available information to determine how you should approach your investment strategy.
Market declines are a regular occurrence and happen frequently. Selloffs provide an opportunity for investors to absorb new information, squeeze out excesses and reset values to more attractive levels.
For existing retirees, we set-up portfolios to include 5-7 years’ worth of high-quality bonds/cash to absorb market declines. For savers, market declines are great news as it allows you to buy stocks at lower prices through regular contributions.
We understand the desire to try to head off market declines by moving into safety. However, our view is that the only way to capture the full permanent returns of equities is to ride out their temporary declines.
The danger of trying to time the market is that you will sabotage your personal investment strategy by getting out at the wrong time and then compounding that by getting back in at the wrong time.
The Financial Symmetry Podcast is an original podcast from Financial Symmetry in Raleigh, NC. To learn more about the show or the past 105 episodes, visit https://www.financialsymmetry.com/retirement-podcast/.
The hosts and guests in this video do not render or offer to render personalized investment or tax advice in this podcast. This podcast is for informational purposes only and does not constitute individualized advice or a guarantee that you will achieve a desired result. You should consult with appropriate tax and financial advisors for advice specific to your situation.