What will happen to your portfolio when the market crashes next? Will you be ready or will your plans be wrecked? Let’s run through a list of the lessons we’ve learned that can be applied to the next bit downturn.
Click the timestamps below to jump ahead in the episode…
Other Retirement Facts:
How well could you survive the next market crash? Right now, the market is doing okay, but it’s been a volatile time the last several months. Whether it’s behind the corner or a long way off, you’ll want this guide to surviving a market crash.
Make sure you know how much risk you are exposed to. You don’t want to find out in the middle of a crisis or market crash that you aren’t so comfortable with risk. What kind of volatility can you actually handle? Is your risk tolerance what it should be for your age?
Are you protecting the gains as you go along? Is your portfolio diversified? That doesn’t always mean buying a lot of different things. More doesn’t always mean better. What are you invested in?
No one knows when the market is going to make big moves. Don’t try to time the market. You may get lucky once, but less likely will you get lucky twice. This is where you can end up making bad decisions. Knowing your risk and time horizon will help you to make the best decisions and determine what style of money management you need.
Ultimately, having a well-conceived plan is key to surviving a crash. Without a plan, you’ll have a rough ride. There will be a market crash at some point, so you should plan for it. Plan for inflation, too. You will see tax changes and market ups and downs. The question is, are you prepared for it?
Listen to the entire episode or click on the timestamps below to skip to a particular survival tactic.
0:14 – Phil shares about his summer so far.
1:34 – What are five different rules to survive a market crash?
2:10 – Understand how much risk you’re exposed to.
7:23 – Protect the gains as you go.
9:01 – Be sure you are diversified appropriately.
12:20 – Don’t try to time the market.
15:31 – Have a well-conceived plan in place.
A Quotable Moment:
That’s where a plan comes into play: helping you understand, how much money do I need? What are my income sources? What amounts do I have to pull from my portfolios?
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