By Craig Erwin, Ph.D.
Photo by Jona Orle on Pexels.com
Sometimes financial headlines are horrific. Perhaps the stock market is tumbling and every expert seems to predict that things will only get worse. But when everyone seems to have lost hope, we may have reached maximum pessimism. That’s when everything seems so bad that it can’t get any worse. Fortunately, when everything seems terrible and everyone is in the depths of despair, better times may be ahead.
When the stock market gyrates violently, headlines may proclaim how terrible things are and prescribe what you should do about it. But no one knows for sure what’s going to happen next and it’s hard to know whose advice can be trusted. Journalists crave eyeballs; that’s why they sensationalize. Don’t trust them with your future.
So, what must you do if the news is awful or full of predictions for a stock market crash or recovery? Nothing. On any given day experts are likely to predict a crash, a recovery, or both. But they are wrong much of the time and, even if they are right, following their advice may mess up your plans and steer you off course.
So, what should you do? Nothing. If you have a retirement savings/investment plan in place, stick with it. Don’t let headlines or others’ opinions throw a wrench in your plans; stay the course. If you feel like you just have to act, then increase the amount you save per paycheck, especially if you’re really afraid. That takes guts, but it makes great sense because you will buy stocks on sale since their prices have been beaten down. And the more terrified you are, the lower the sale prices are likely to be. That will pay off big when the market rebounds and the stocks you bought on sale bounce back.
For more information on the stock market, the economy, and investing, click on the following links:
Leave a Reply