Prefer to watch? Click here to watch and listen on YouTube.

As recent market fluctuations have stirred up a lot of economic uncertainty, there’s a particular question on many investors’ minds: When the market is down, how should I respond?

In this episode of Money Wisdom, Jake Doser, CFP®, CPWA® and Nicholas J. Colantuono, CFP® tackle this timely viewer question, offering insights into the psychology of money, risk management, and the importance of sticking to a long-term plan.

Don’t Let Emotions Get the Best of You

There’s no denying that checking your accounts when the market is up feels great. But on down days, seeing a sea of red in your portfolio can be downright painful. While we can’t guarantee it will always be the case, the market has historically grown over the long term.

That’s why “staying the course” and not giving into emotional decision-making is such common advice. It’s so important to have a plan in place before volatility strikes.

Why Planning Matters

Taking on too much risk when the market is rising can lead to panic when retirement is around the corner and the market dips. Without a plan, you’re left wondering what to do next. This is where true financial planning comes in.

Many people base their risk tolerance on how they feel about risk, rather than how they actually plan to use their money. The result is often a disparity between emotional comfort and financial reality. That’s why setting clear expectations and sticking to a long-term strategy is so essential.

Diversify, Don’t Gamble

Investing isn’t about betting on one company or trying to time the market. Smart planning means diversifying across time horizons and risk levels. Our philosophy is to divide your money into three ‘buckets,’ each designed to serve a different purpose over varying timeframes.

We understand that when markets drop 10% or 20%, your emotions will want to take over. That’s when you need a good advisor to offer a calm, objective perspective. With their guidance and a solid retirement plan, market volatility shouldn’t derail your financial goals.

Interested in building a simple, actionable plan for your retirement and investment success? Get your free Money Map book by texting “MAP” to 800-757-0436.