What do you do when the share markets have dropped by 10%, 20% or even 30%?
Tue July 12th 2022
Are the share market declines keeping you awake at night?
When the share markets drop in value, it is quite normal to be concerned about the impact a large decline will have on our investments, KiwiSaver and retirement savings.
Our emotions and worries can cause us to panic and pivot away from our original plans. It can even keep us awake at night. We ask questions like, “what will happen next, how long will this last and what should I do next?”
Market ups and downs are normal and shows signs of a healthy and transparent share market. However, the danger is we look at them on a daily or weekly basis similar to the daily weather report, whereas the best way is to see your investments more long-term like the seasons.
The Good News is that history shows that stock gains can add up after big declines.. You may be surprised to see what these positive returns look like.
Here are three easy tips to help restore confidence and clarity in your investments:
- Sticking with your plan, rather than trying to switch and time the market, helps put you in the best position to capture the recovery.
- Revisit your appetite to risk such as how comfortable are you with the market ups and downs. Reach out for an investment risk questionnaire to give you more detail on what investment allocation and fund you should be in.
- Book an appointment to get an independent second opinion with your investment adviser to discuss your investment and confirm whether it still structured correctly for you and your situation and long-term goals.