Have you seen the market lately? I have personally lost thousands of dollars in my Roth IRA and 401k. All of my gains from 2019 are completely wiped out. In fact, my balance in my highest grossing account is currently negative by 7%. How deflating is that?
So when scares like the coronavirus happen, what do you do to mitigate the losses in your retirement savings? If you have been paying attention to any of the investment communities online, you would notice a pattern. There is a lot of back and forth between liquidating your assets, or holding long term.
With all of the world news affecting the stock market, I have been able to deploy my market downturn investment plan. So how do I behave when the market falls? Here are 4 things that help me keep on top of my retirement savings.
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Fight the urge to panic
I know that the news has a direct effect on the market, but I am going to be completely honest. The last few bullish years of the market had me completely sure that I have seen the worst of the economy. As foolish as that sounds, It’s easy to forget that a lot of the younger generations have not experienced a real stock market downturn.
Whenever the market is not moving in my favor, I just control what I have power over. Myself. Outside of people who plan to retire in the near future, most of us do not need that money. I personally do not plan to enjoy my Roth retirement for another 30 or more years. So since I have no control over how my money performs in the market, I focus on staying calm, and knowing that the market bruise will heal itself in time.
Listen for news updates on the market
Deploy cash into discounted positions
Hopefully you have been accumulating a good cash position while the market was on a rally. Whenever I start to feel scared about the status of my portfolio, I beef up my emergency fund. This is as far as I let the fear take me, and I act while the market is doing well. This way, I will have a large enough accumulation of money to use when my watchlist prices become more attainable.
I like to put money into my account once it hits at least 1000 dollars. This way I feel like I am entering into a substantial position. This is where the fun begins! Chances to buy on a potential dip don’t come too frequently, and now is a great time to take advantage of the market downturn.