Act now, the stock market is having a sale!

Act now, the stock market is having a sale!

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If you’ve read any news this week, you’ve certainly gathered that the stock market is crashing. Don’t fret, this is just temporary, and like all other storms, it shall pass. Continue reading for some pro-tips to help you ride out the storm and capitalize on those dips!

What to do when the market is crashing

First, don’t panic. As you can see below, the stock market trends up over the long-term.

Sourced from Macrotrends.net

The key here is “long-term”. You need to determine your investing timeline and see what is best for you. If you are looking to retire in 2023, holding 100% stocks may not be the best bet.

Cash reserves, deploy!

If you have a bunch of money sitting in a 0.1% interest checking account, this may be the time to put it to use. If you need some more info on where to start, I wrote an article that should get you going! I just found an extra $2,500 I had sitting in a savings account and decided to put the money to work today.

If you don’t want to pick individual stocks (which I don’t, either) you can start with a total stock market index fund like Vanguard’s VTI or iShares’ ITOT. This will get you immediate total market exposure without worrying about “what company to buy”.

Playing the stock market for the long term

At the end of the day, you won’t hear much short-term financial advice from us here. We’re playing the long game, and for most stock market investors, this is the safest play. Sure, you’ll encounter day traders that claim they’ve made millions, blah blah blah. But realistically, you’ll find plenty more investors that have made millions slowly over 3-4 decades.

One more thing, if you’re nervous about getting started you should read about Bob. He’s terrible at this but still ended up okay in the long run!

What to do instead

We know that some people have a natural fear of the stock market, and that’s fine. I’m not going to act like it won’t put you at a disadvantage long-term, but I’m not here to dictate that.

Today, iBonds are a great investment option that is safer than the stock market. In fact, it turns out the Federal Reserve just set a historically high interest rate. If you want to know more, TheStreet has a good article explaining all the details!

Author

  • D.C. joined the Marine Corps right out of high school. When he left active duty after 5 years of service, he quickly earned a bachelors degree and an MBA. He got his first private sector job at a modest salary and quickly worked his way up through promotions. Once he started making decent money ($38k at the time), he quickly realized he needed to learn how to save for his future. After nearly ten years of research and application, he wants to share his knowledge and financial best practices so more people can become Wealthy Idiots!