WICHITA, Kan. (KWCH) – After a troubling few days on Wall Street, many are looking at their investment accounts with some unease. The stock market plunged into what is called “a bear market”.
What does this mean for your money and what should you do? Eyewitness News spoke with a financial planner to answer these questions.
When there is more red than green on Wall Street, the impact can be felt on Main Street as people focus on retirement and other investments. But financial planners say that at times like this, it’s important not to just focus on the bad. The advice of Leading Edge Financial Planning President Michael Proctor is not to panic.
He said to step back and make a financial decision with a cool head, not to do anything quickly.
“There aren’t a lot of times that force usage to sell, sell at the bottom of the market,” Proctor said. “Really, it comes from within and the insecurities we may have around money.”
A bear market means in the index, in this case the S&P 500, falling 20% or more from the most recent peak, which occurred in January.
“Put simply, that means the stock market is down,” Proctor said. “If you sell what used to be $100, you’ll get $80 today, maybe a little less. »
He said bear markets often resolve within a year and while it might be down, the balance at some point was going up.
“Remembering that patience is a virtue, especially when it comes to money,” Proctor said. “Be ready to ride it or smile and bear it.”
At times like this, he said that’s why it’s important to have a diversified portfolio to be prepared for the long haul.
“I hope they received good advice on having enough income-generating investments in their portfolio so that they can weather the market downturns as we know it today.”
Proctor said it also presents an opportunity for people who might have considered investing to enter when the shares are on sale. But, he said, it’s also important to figure out what those financial goals are to get the most out of those investments.
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