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Stock markets are turbulent, again. Here’s what experts say you should and shouldn’t do.

What should you do when the stock market is making you seasick? If you’re investing for retirement, it depends on when you plan to retire.

Trader Phyllis Arena Woods works on the floor of the New York Stock Exchange on Jan. 24. (Courtney Crow/New York Stock Exchange/AP)
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Investment professionals have been issuing stock market reports in an effort to calm investors worried about the Russian conflict in Ukraine.

It comes down to this. Just don’t look at your retirement account. Not now. Not while the steep drops might make you do something you’ll regret later.

“Geopolitics have a history of rattling markets and stocks are likely to be on edge for the next several weeks,” wrote Lindsey Bell, Ally’s chief markets and money strategist. “The good news is that the impact tends to be short-lived, only lasting anywhere from 1 to 3 months. Historically, twelve months after such an event, the market edges higher. Additionally, despite European stocks getting hit hard today, they have held up relatively well since the conflict started.”

If you are invested for the long-term, short-term politics shouldn’t change your investment strategy, Bell said.

Although there is a flight to safer investments, snapbacks from corrections in the stock market tend to be very sharp, wrote Keith Lerner, co-chief investment officer for Truist Advisory Services.

“As discomforting as the headlines are, from an investment perspective, we would urge investors not to overreact,” Lerner said in his market perspective. “Panic selling has generally not been a winning strategy.”

Following the daily plunges will only make you sick, or second-guess yourself — emotions that will very likely lead to losses.

Biden announces new sanctions and decries Russia’s ‘brutal assault’

I know that’s easier to say than do when you’re an investor and news reports relay every move the market makes.

But we’ve been here before, and not too long ago. Remember March 2020, just as the pandemic began hitting the U.S. hard?

On March 13, 2020, The Washington Post’s website carried this headline: “U.S. stock market suffers worst crash since 1987, as Americans wake up to a new normal of life.”

On that day, the Dow Jones industrial average experienced a 10 percent loss. It marked the Dow’s worst day since the heart-stopping Black Monday in October 1987, when the Dow lost more than 22 percent of its value in a single day.

Fast-forward to year-end 2021 — Dec. 31 to be exact — and a headline on The Post’s website read: “2021 goes down as a year of high risk and high reward for markets.”

But every crisis brings its own concerns with Russia’s hostile acts causing the market volatility this time. Even so, much of the advice to hang tight is the same.

Stocks claw back after Russia attack on Ukraine roils markets

“I fear investors who are new at this won’t understand what’s going on or what to do, and their inexperience will cause them to let their emotions dictate their actions,” said Ric Edelman, host of “The Truth About Your Future,” a nationally syndicated radio program.

Investors who respond with calm and clarity during such times often reap rewards for their patience.

“I think it’s wise to stay calm and avoid big ‘either-or’ moves, especially moving out of stocks entirely,” said Christine Benz, director of personal finance for Morningstar. “Selling stocks can provide some short-term peace, but it’s often immediately replaced by a nagging worry of, ‘Is it time to get back in?’”

I made the rounds of financial experts I frequently poll when the stock market is having wild swings. Here’s what they advise for various investors.

  • You’re not investing: “You’re at risk of missing out on some of the biggest gains as the market recovers,” said Mychal Campos, head of investing for online investment firm Betterment.

As the market dips, this could be a good time to jump into investing. The ideal way to invest is to buy low and sell high, said Ernest Burley, a certified financial planner and owner of Maryland-based Burley Insurance and Financial Services.

“As the market recovers, you have the potential to earn some gains on the ride up,” Burley said. “People often buy high and sell low because they invest purely on emotions. This is a surefire losing strategy.”

  • You’re a young adult investor with years to go before retirement: “Younger people saving for the long-term future need to have an allocation that allows for growth and use opportunities like the current market upheaval to rebalance their accounts,” said Carolyn McClanahan, a certified financial planner who founded the fee-only Life Planning Partners based in Jacksonville, Fla.

Want to weather turbulent times in the markets?

Start with a solid investment plan.

“Having been through so many market upheavals in my career, I feel like my answer is very boring, and it still works,” McClanahan said. “People should always have a goal for their money, and their investments should be allocated based on their goals.”

In the long run, slow and steady stock-buying easily beats trying to time market dips, experts say

  • You’re 15 to 20 years away from retirement: Investors in this category should definitely check their asset allocation and compare it with their target goals, the experts said.

Here’s the problem: A lot of investors don’t have asset-allocation targets. If they’re managing their own portfolios, they might have overly risky or overly conservative portfolios, Benz said.

If you’re unsure of how to allocate your retirement contributions, a target-date fund might help you avoid panicking when the market is jumpy.

Think of these funds as operating like the “set it and forget it” slow cooker that allows you to simmer a stew with little effort. The idea is that you don’t have to closely monitor your investment account because the asset allocation and rebalancing are done for you. The funds automatically rebalance from riskier investments to more conservative ones as you reach a target retirement year. Just note that even though various funds may have the same target date, the returns can vary.

How to stay on point with target-date funds

“I always think a target-date fund is a decent starting point for benchmarking asset allocation,” Benz said. “It’s not perfect in every situation, but it’s certainly better than nothing.”

  • You’re five years away from your retirement date: “You’re a short-timer,” Burley says.

Here’s a general rule of thumb on risk tolerance and investing, according to Burley:

The more time you have before touching the money, the more aggressive and growth-oriented you should probably be because you have more time to try to earn some gains. The less time you have before touching the money, the more conservative you should probably be because you have less time to recover from any losses.

However, some people don’t plan to touch their retirement money right after retirement, so their time horizon may still be 10 years or more, he said.

“Each person is different,” Burley said. “As one of my clients so eloquently stated, ‘I’m retiring, I’m not dying, so I still want my money to grow.’ ”

With recent events, Benz said she’s been thinking about people who are getting to close retirement and know they should “de-risk” and add more cash and bonds.

“Given that the market has gone down a lot already, they might be disinclined to sell stocks because they fear they’re too late, she said. “But I would remind them that stocks’ recent losses are a drop in the bucket."

The U.S. market still has had double-digit gains over the past 3, 5, and 10-year periods, Benz pointed out.

“So if de-risking is appropriate given someone’s situation, it’s absolutely not too late,” she said. “And yes, the alternatives to stocks are unappealing. Bond yields are low and we’ve seen bond prices fall on worries over rising interest rates. But on a day like today, high-quality bonds are holding their ground.”

  • You’re retired: If you’re living off your retirement account, you should have at least five years of cash needs in safe investments, McClanahan said.

“Now is a wake-up call to do a good financial plan to understand your cash-flow needs and construct an investment policy that takes into account your cash-flow needs going forward,” she said. “The problem with a market downturn is you don’t know whether it will keep going down or go back up, so you need to plan for the worst.”

When the markets look dire, often the best thing to do is nothing, Campos said.

“People seem to have short memories about market drops,” McClanahan said. “They always think, ‘This time is different.’ It isn’t.”

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