Bear market? More like stocks on sale

Market downturns are opportunities to own more.

View in browser NextAdvisor ISSUE 103 June 28, 2022

Recession. Bear market. Inflation. These are the big financial buzzwords as of late, and it's hard to even read or watch the news without seeing coverage about it. Of course, there's a reason for it. The stock market had its worst start since 1939 this year — and some experts fear that's just the beginning. A lot of factors are contributing to it: geopolitical tension in Europe, rising fuel prices, supply chain issues from COVID-19 variants, and the trillions of dollars pumped into the economy over the past two years. If you have never put money into the market before, this may not seem the most obvious time to start. But I'm here to tell you the complete opposite. When I first started investing, any bad news about the stock market would immediately make me fearful and anxious. Now, as I read stories every day about bear markets and an impending recession, I ignore the noise and transfer more money into my investment account. In fact, I recently upped my 401(k) contributions, which means I'm investing more than I ever have before. So, how did I go from one extreme to the other? I listened to the experts. Instead of experiencing market downturns as triggering and anxiety-inducing, financial advisors say you should see them as opportunities, provided you are still years away retirement or your own financial independence goal. Market downturns mean all the stocks you were buying while the market is up go on sale, by effectively dropping to prices previously unattainable without a time machine. Basically, you can "buy the dip" and own more with the same amount of money. You can even start investing with as little as $5. Like stocks, cryptocurrency prices are lower than they've been in years. Now could also be a good time to get in the crypto market while prices are low, but only after you've assessed your risk tolerance and prioritized other aspects of your finances, like saving for an emergency, paying off high-interest debt, and investing in a traditional retirement account like a 401(k). When there's volatility in the stock market, the best course of action is to be aware, but stick to your investing plans. It's impossible to time the market, and historically speaking, it's always recovered. It's been proven that the best performing portfolios are those that have the most time in the market (look at the data here). It could be a bumpy road for the stock market for the remainder of 2022. But, crash or no crash, recession or not, history tells us time and time again this is part of the journey when it comes to investing. What do you think of these weekly emails? Any other topics you're interested in reading about? Tell me at alex@nextadvisor.com or @AlexGailey on Twitter.     These Experts Predict the Worst Is Yet To Come in the Stock Market. Here's Why — And How To Prepare Read the full article       THE BOTTOM LINE As the market ebbs and flows in the next six months, avoid pulling out when things get bad. Experts agree it's best to hold onto your investments and ride the wave. More soon, The NextAdvisor Team     Was this email helpful?       Did your financially savvy friend forward this to you? Subscribe to get our next newsletter directly in your inbox.   Sign up     Your next move Follow us on social media for more great tips like these.

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