Things are opening too fast too soon. That’s the bottomline. So, here we are, breaking our record for the number of new Covid19 cases on a daily basis.
With the S&P dependent on a handful of companies, rising unemployment, and unprecedented printing of money, both a dollar crash and a market crash is imminent.
You might as well prepare for it. How? We have 3 tips.
#1 Start by mentally preparing for it. Your market investment is as good as half.
You are most likely going to lose half of your investment. If you hold a $100,000 stock portfolio, know it will be worth $50,000 when the crash happens.
In fact, certain areas of the stock market, including retail REITs and oil and gas producers, have fallen that much, if not more.
Of course, even long-term investors know that it’s impossible to gain all the time. Just make sure that if you decide to risk it and keep your money in stocks, you can afford to either completely lose it or wait years to get it back.
#2 Invest according to your age
Depending on your age and tolerance for risk, it may be a good idea to play it safe for now.
If you’re nearing retirement age, a stock market crash could devastate your savings. That’s why as you get older, it’s a good idea to invest less in stocks and more in conservative investments such as bonds.
The older you are, the more conservative your portfolio should be — especially when the stock market is volatile.
#3 Time to go non-traditional
Invest in metals – gold, silver, platinum, and palladium. You will not lose.
Metal is the only investment that has consistently gained through all economic collapses. Consider holding some solid as a part of their diversified portfolios to combat market crashes and for long-term wealth creation.
Whatever the amount of gold you buy now, that won’t lose its value. Keep it there and you will get at least a 35% gain in a year as gold is projected to get to $3000 as per Bank of America.
Lastly, only invest money you won’t need for the foreseeable future.
Even during strong economic times, it’s wise to only invest money you won’t need anytime soon, but this is especially important during market downturns, because pulling your money out of the market at the wrong time can have serious consequences.
Not only could you potentially be subject to income taxes and a 10% penalty for withdrawing money from your 401(k) or traditional IRA before age 59 ½, but you could also lose money on your investments.
If you invest now but then need to pull your money out in a few months, you could end up selling when stock prices are at rock bottom and locking in your losses.