It’s never a good idea to feed a bear, should the thought come across your mind, remember to just say no. That rule may only apply to real life bears, and not bear markets. Bear markets are interesting; while they are generally negative, they create unique investment opportunities for some and poor ones for others. So, who’s feeding the bear market? CNBC’s Carmen Reinicke reports on polling done to discover the percentage of investors looking to increase their investment in this market.
Feeding the Bear Market
CNBC’s report finds that only 18 percent of American investors are looking to increase the amount they invest. This isn’t to say that people aren’t still investing. Of the Americans polled, 50 percent responded that they would continue to invest but at the same rate as the year prior.
Bear markets like this, tend to benefit younger investors. Higher market volatility can have significant pay offs but may require time to deliver on any positive return. It makes more sense for younger investors, who can afford to wait to collect on their investments, to double down in a bear market where stocks are cheaper.
For seniors, and older investors in general, it makes much more sense to maintain their rate of investment. Bear markets and 401(k)s have a tricky relationship, one that can prove to be beneficial but will always be risky. Seniors, who are retired or looking to retire, should continue to invest, but at a rate that feels comfortable to their situations. Prioritize the type of retirement account rather than the amount of the investment for a higher rate of success.
Investing is tricky, so always have a plan in mind. Talk with a financial advisor will help you succeed even further. For more senior news and updates, follow the Council for Retirement Security. And join the Council in its fight to protect the Trust against Insolvency today.