Stock Market Downturn and Fluctuations
What to do with your investments when the stock market drops
Have no fear, fellow Blooomers! Blooom was founded by financial advisors who've been through a market swing or two. Both experience and history has taught us that the wisest thing to do in a market downturn is to avoid panic.
THREE O'S TO INVESTING
DURING TURBULENT TIMES
Own your strategy.
You (should) have a long term strategy in place. Stick with it. Nearing retirement, or years to go, you likely don’t need to be accessing all this money today.
Opt to stay in.
It’s not a loss until you sell. You’re at a fork in the road–you can sell and trigger a loss, or hold on and ride it out to recovery.
Odds are good.
Facts. Stick to ‘em. History suggests, this too shall pass. 100% of past market declines were followed by a full recovery and eventually new highs.
Still considering selling?
Seven questions to ask yourself...
Why are others buying when you are selling?
Someone believes the stock you just gave up will be worth more in the future, otherwise, they wouldn't be buying. Right?
Do you believe the market will be higher when you retire?
Although ups and downs are inevitable, history tells us the market trends up over time. Hold on an enjoy the ride!
What are you going to do with the money if you sell now?
If you don't plan on touching your nest egg for decades, why do anything?
Will you stop contributing?
Remember, if you stop contributing, you'll lose out on the free money you receive through your company's match. You'll also miss out on all the potential future growth if/when the market comes back.
Are you tempted to cash out?
Careful! You’ll want to understand all of the tax implications and, if you’re not eligible to take the money yet, possible penalties for early withdrawal. If you hate losing money, the last thing you’ll want to do is cash out and pay a penalty.
How will you know when to start buying again?
How do you know when the market is going up except after it's already gone up?
Do you have a long-term strategy?
If so, great! Stick to it! If not, blooom can help.