Michael Raines/Getty Images
Michael Raines/Getty Images
Have you recently reviewed your retirement plan? Major indices such as the S&P 500 and Russell 1000 hit 52-week lows. And the Dow has plunged into what experts call a “bear market.” This means the stock has fallen 20% from its recent highs. All this means that your stock is probably much less valuable than it was a year ago.
So how should you handle your investments at this point? Talk about how to manage stress and anxiety about markets.
Here are the gists of the conversation:
- Do not withdraw money! If you have money in your retirement plan or investment account and the market is down significantly, that’s actually the worst time to sell stocks, says Sokunbi. Stocks are assets. Today it may be valued below what you paid for. But “you don’t lose anything unless you actually sell it,” she says. “Right now, the economy is cyclical, so we want to ride out what’s going on in the market.” is included.
- Please refrain from logging into your account. Seeing the value of your investment account plummet can trigger many emotions, Sokunbi says, including fear, anxiety, regret and anger. “If you don’t need the money right away, it doesn’t matter if you don’t log into your account this week, this month, or this quarter,” she says. read a good book Spend time with your friends. Go for a walk (useful life her kit her guide on how to enjoy nature here).
- In fact, now is a good time to invest. Now may not be the right time to sell stocks, but it’s a good time to buy stocks, says Sokhumbi. Stocks have fallen significantly, so you can buy more stocks with less money. “The stock market is basically selling right now,” she explains. “And we all love a good sale.”
- But… only invest if you can afford it. A few questions to ask yourself before investing: Do you have enough savings to cover basic living expenses if you lose your job? Have you paid off your high-interest loans? Socumbi said many credits on his cards charge him more than 20 percent interest. You usually have to pay them off before you invest the extra dollars.
- Evergreen Tip: Utilize Employer Matches. Many companies offer their employees matching retirement plans. For example, if you invest his 5% of your salary, the company may donate the same amount instead. The financial media’s website Investopedia has a guide on how these matches work. Always invest at least enough for a perfect match, says Socumbi, if possible. Otherwise, you will be turned down the free money.
The audio portion of this episode was produced by Clare Marie Schneider. The digital story was edited by Malaka Gharib. We look forward to hearing from you.please leave a voicemail 202-216-9823or email us LifeKit@npr.org.
