Don’t sit your cash on the sidelines

This true story reminds me of what I often hear from clients who are holding cash and trying to decide when to invest in the stock markets. It’s easy to end up sitting on the sidelines, just like Lauren. When the markets drop, it’s only natural for investors to expect the downturn to continue. When the markets rise, you may feel like you missed the bottom and prices are too high again. Don’t let this happen to you. U.S. stock markets have performed strongly over the past 10 years, but they’ll eventually correct themselves. It’s impossible to predict when and how severe the correction might be. Think back to the 2016 U.S. presidential election and Britain’s decision to leave the European Union. The stock markets didn’t react how most people thought they would in the events’ aftermaths. The lesson: Markets are unpredictable.

Get in the game

Act sooner, not later. Determine your time horizon. Choose an asset allocation of stocks and bonds that offers the risk and return you’re comfortable with during up and down markets. You might even want to consider establishing an emergency fund too, which could help you meet living expenses during a down market and allow you to sleep better at night. Lastly, always save through a disciplined approach. Purchases you make in up-and-down cycles stay invested in future markets. There’s an old saying: “You can’t win if you don’t play the game.” Investing in the markets will assuredly give you the potential for better returns. Or you could sit on the sidelines with Lauren, lamenting missed opportunities for long-term retirement savings growth.      


All investing is subject to risk, including the possible loss of the money you invest.

Be aware that fluctuations in the financial markets and other factors may cause declines in the value of your account. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income.