The Setup:

When the market crashes, it’s normal to feel panicked. But we’re here to help you build confidence and get through these tough times with a five-step market crash survival guide.

Click the timestamps below to skip to a specific topic in the episode.

The Combination and Key Points: 

Experiencing a market crash like we did this year can be tough on investors. A recent poll found that 72% of Americans say they’re going to prioritize financial planning once the pandemic is over. Those who felt financial pain after losing their jobs are most likely to change their spending habits because pain can be a great motivator.

To help ease your panic and find confidence in your investment strategy, we are sharing a market crash survival guide on this week’s episode of Unlocking Your Financial Future. Ben Schrock and Dan Oaklief explain the top five things you can do to survive a market crash.

1) Know how much risk you are exposed to

It’s important to know how much risk you are exposed to and to know about your investments. Many people with 401Ks don’t know what they are invested in.

“If you read the prospectus, God bless you because those things are like 50 to 100 pages thick and getting through that to see what you actually own is pretty complicated. But we try to simplify things here,” Ben said.

2) Protect your gains

“A lot of clients call us when the market’s down and they want to sell, sell, sell, sell. But we don’t get a ton of those questions that say hey, the market’s on a bull run, it’s been up,” Dan said. “We do have a couple different strategies to protect some of the gains that you accrued in your account.”

3) Have appropriate diversification

You can have 50 mutual funds and think you’re diversified, but you could be buying the same things over and over, causing a lot of overlap in your portfolio.

“Diversification does help weather the storm when we have volatile times like we had recently with the COVID crash,” Ben said.

4) Don’t try to time the market

Timing the market is like trying to catch a falling knife. There’s a lot of risk involved there. We explain why waiting out a bad market could be a bad idea and what could happen if you stay put.

5) Don’t panic

“Having a plan does not prevent panic. Our job is to calm you down a little bit and remind you of that plan we have in place. What we’re trying to do is give you greater confidence,” said Ben. “Panic is natural. It’s going to happen. Call us. Talk to us.”

We’ll go into each of these in detail on the podcast so check out the show at the top of the page and hear what Ben has to say about all five of these points.

[1:23] – Poll: Americans want to prioritize financial planning

[4:37] – Know how much risk you are exposed to

[6:18] – Protect your gains

[7:34] – Have appropriate diversification

[9:47] – Don’t try to time the market

[12:31] – Don’t panic

Thanks for listening to another episode of Unlocking Your Financial Future. We’ll talk to you again next week!


 

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