3 Things You Shouldn't Do If the Stock Market Crashes

There's a right way and a wrong way to handle stock market crashes. Getting the next one wrong might permanently reduce your investment returns. Avoid these three common mistakes if you want to navigate the market cycle like a pro.

It's nearly impossible to remove emotion from your financial plan. Who could be completely dispassionate when it comes to their kids' college funds or their retirement nest egg? You've spent years diligently saving and investing for growth, of course you're going to freak out a bit if your assets suddenly tank in value.

However, you have to resist the instinct to panic if you want the best long-term investment outcomes. That's easier said than done, but consider historical market dynamics for some valuable perspective. Volatility is a natural part of equity investing, and market crashes happen. If you're in the market for the long haul, bear markets are unavoidable. Don't blame yourself or your advisor when an event occurs that we should recognize as inevitable.

Continue reading

Source Fool.com