Should You Really Be Investing in the Stock Market in 2022?

The stock market was remarkably strong in both 2020 and 2021, buoyed both by stimulus money and by an exceptionally accommodative Federal Reserve. With valuations stretched by historical measures, the Federal Reserve looking primed to taper in 2022 due to inflation, and stimulus payments largely in the past, those bullish factors are starting to reverse. That could cause serious problems for stocks.

That raises a very key question: Should you really be investing in the stock market in 2022? The stock market could easily crash again, and money you invest just before a crash could take years to recover to what it was when you invested it. On the flip side, there are no guarantees that the market will crash in 2022. If you pull your money out and miss out on further growth, you could regret that, too.

Rather than get paralyzed into inaction by all that uncertainty, it's a better idea to take advantage of what the market is currently offering you. With a little bit of smart planning now, you can set yourself up to continue investing in stocks in 2022, while still protecting your overall finances from the near-term risks from the current lofty market. Read on to figure out a strategy that could keep you invested in stocks, despite the turbulence that may be headed our way.

Source Fool.com