Jason Gunkel, CFP®, CFA, CAP®, Chief Investment Officer
March 24, 2022
Chief Investment Officer and Financial Planner, Jason Gunkel, explains the in’s and out’s of market downturns and recoveries and the correlating effects on the bond market. Investing in the financial markets can be a bit of a roller coaster ride!
But it is important to keep market downturns in perspective and to stay the course of your investment plan.
For clients, Jason recommends doing two things in order to avoid having to sell investments during a market downturn.
Save 6-12 months of living expenses built-up in cash available to meet short-term needs.
Keep 3-5 years worth of living expenses in high quality bonds. This creates adequate time for investors to let their stocks recover in value while they can draw from the bond portion of their accounts to meet their living expenses.
A diversified portfolio of stocks and bonds can help tame the roller coaster ride for investors. Having a well developed investment allocation along with a distribution plan can make market downturns much less scary.
Finance Moment…Syverson Strege’s mini-podcasts to provide rapid-fire information on financial topics of the day.