12 Best Pieces of Advice for When the Market Is Going Down

June 3, 2022
Thomas Kopelman

Stocks are down, the S&P 500 is down, bonds are down, and crypto is down. Red is all we are seeing. We have officially entered a recession and it may not be ending anytime soon.

I get it, many of you are feeling worried about the future. It’s uncertain and that is scary. Well, this post was created for you. I want you to read this now but also reference it in the future when times are tough again.

Here are the 12 best pieces of advice to remember when the market is going down!

1) Zoom out

This is just great advice, sometimes we are too zoomed in on what is happening over a couple days. When we look long term, we tend to be a lot happier with the results and progress we have made. Check the stock market and your portfolio less often and you will be a lot happier.

2) Distinguish between risk and opportunity

Bear markets scare us because of uncertainty, but if we look at the numbers and understand that we see recessions often, almost every 4 years. And that they only tend to last between 1-2 years, we can then understand this is part of the investing journey. You have to get used to it. Keep investing for the long term.

3) "How can I take advantage of this opportunity?"

When your investments are for the long term, all these downturns are actually opportunities to buy more at a lower price!

4) "Why am I investing?"

I love how he actually validated peoples’ feelings. It’s in our nature to be worried as we see our hard earned money going down in value. But… just because we are worried does not mean any action needs to be taken. Stay the course, this will pass. Just keep buying.

5) Get professional advice

I really like Greg’s point in part 2. Too many of us look at our investments daily and turn it into some type of game. Do you look at the price of your car or your house everyday? No. And you shouldn’t either with your investments. The value of them today, tomorrow, or next week does not really matter when these are dollars you will not be using for 20+ years. Save for the short term and invest for the long term.

6) Remember your why

Take a step back and see how far the market has come over the past 20,50, or even 100 years. There have been plenty of recessions and yet the market has fared well. Time is your greatest asset with the market.

And remember, anything you are saving for in the short term should not be in the market. The market is too unpredictable in the short term.

7) Stay the course

We truly have no idea if right now, tomorrow, next week, or next month is the bottom. Trying to make decisions and predict it is a losing game. Stay with your plan!

8) Restate your goals

This is where making a plan becomes so important. Whether you use an advisor or DIY it yourself, create a plan and have the proper buckets laid out. You need a few years in cash to weather these downturns!

9) Review your savings

This is a great point by Zack. Go through your plan. Do you have short term, mid term, and long term goals covered? If so, then you are good to go. What the market does over the next year doesn’t matter. Your investments are long term money!

10) Be forward-thinking

Many people sell out of their investments when the market goes down. But… does the economic conditions that are happening make you think that these companies are any less valuable? Are people going to continue to use apple products, buy cars, etc? I would think so over the long term, these are still great companies. Nothing has changed.

11) It's a sale

Everyone loves a good sale right? The problem is most don’t think of stocks being lower as them being on sale. We like to buy when things are going up, and sell when things are going down. The opposite of how we buy anything else in our lives. Take advantage of this sale if you are a millennial!

12) Perspective

The theme of this is to zoom out, look at the facts, and look at what has happened in the past so you can keep going. And I know, this time may feel different. It may be the black swan event we all worry about. However, every recession feels different than the last one. Ask someone from the early 2000’s. That one, 2008, 2020, etc. all felt different than the last. Doesn’t mean we won’t get through it.

I hope this helps you stick with the plan and zoom out during these tough times. It will all be okay!

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