Here's how experts say you should handle retirement funds in light of extreme volatility caused by COVID-19.
So what should you do? Here are the answers to your biggest questions about how to handle your 401 right now, according to experts.If you’re feeling panicked about a chunk of your retirement savings vanishing overnight, that’s a valid response to the situation. But it’s not one you should act on.. If so, it probably feels like the cruelest form of déjà vu. But remember that the market did recover eventually.
In other words, leave your money where it is. As long as you’re not planning to retire in the next couple of years, you have plenty of time to make up your losses, and then some.Contributing funds to a 401 that’s losing value might feel akin to setting money on fire. But if you can, it’s best to keep your contributions going.
It’s also a good time to buy in. “The market is ‘on sale’ right now,” said Ashlee deSteiger, founder and financial adviser at. “You will look back on this moment in time and be thankful you stuck with your retirement savings.” For example, if you’re having trouble keeping up on your bills or at risk of losing your job, you might be better off stopping retirement contributions temporarily to free up more income. And if you’re planning to retire soon, you have hopefully been adjusting your portfolio toward lower-risk investments anyway. Still, it might be time to talk to a financial adviser about the best place for your remaining contributions.
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