4 tips for investing in the stock market in turbulent times

Experts’ advice is to hold onto investments during turbulent times, but a new MagnifyMoney survey found that some investors have gone against the insiders, as due to current events in the past year, nearly 40% of young investors surveyed said they have withdrawn money from the stock marketand many lament their knee-jerk reaction.

MagnifyMoney, the financial advice site commissioned Qualtrics to conduct an online survey of 1,050 US consumers from April 15-20, 2022 and found, that:

70% of Americans say world news and current events influence their financial decisions.

63% of consumers mentioned inflation as one of the main current events that affected their financial decisions and 51% mentioned the coronavirus pandemic.

– Among Americans who said current events affect their financial decisions, the 46% focused on building emergency savingsa.

– The survey found that younger investors are more likely to get money out of the stock market, at 67% of Gen Z investors and 57% of millennial investors doing so. However, if these investors are in it for the long haul, they own one of the most valuable assets, time.

“Time is the ultimate weapon when it comes to investing”says Matt Schulz, chief credit analyst at LendingTree. “It gives younger investors a huge advantage over their older counterparts. Unfortunately, though, Gen Z and millennials risk wasting that advantage if they pull their money out of the market when times get tough. Your best move is to stay focused on the future, leave your money in the market, ride the wave, and trust that better times are ahead because history has shown that when it comes to the stock market, they almost always are.”

Not waiting for it to happen could be the reason a lot of young investors are more likely to regret it. Approximately 45% of Millennial investors who dropped out wish they hadn’t, along with 39% of Gen Z investors.

While a portion of Americans have withdrawn from the stock market due to current events, many have shifted their focus to saving for emergencies. Looking back on the turbulent past year, the survey shows that more Americans are seeing the value of building their emergency funds. In fact, among those who said current events affect their money decisions, focusing on emergency savings was the top priority for almost half (46%) of them.

4 tips for investing in the stock market in turbulent times:

1. Avoid reviewing your investments

If you’re in this for the long haul, don’t review your investments daily. Watching them too closely could tempt you to sell.

2. Stay away from the news

It’s easy to stress over bad news consuming them throughout the day. Regardless of how you consume news, don’t forget to take a break and unplug.

3. Focus on the future

Stocks go up and down all the time, but in the long term, they tend to have an upward trend. Most portfolios have a long time to recover from downturns.

4. Invest more

Consider buying a few more shares of your favorite index fund or company while their prices are low so that can reap the rewards when they come back up.

You may also like:
– 5 ways to invest your money to grow your fortune with little initial investment
– “Quit your job now” advises the “Wolf of Wall Street” on TikTok to a young man with a salary of $60,000
– New York, the second most attractive city to invest in the world