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  • Writer's pictureNate Baim, MBA, CFP®

Is Now the Time to Invest in the Markets?

Video Transcript:

Is now a good time to invest into the markets?

This is a question I have been receiving from a lot of clients lately. And the answer really depends on their unique circumstance. If your are somebody who is thinking about investing into the market right now, l encourage you to take a series of steps in order to figure out if now's a good time for you to invest in the market. Markets have been very volatile, and it's likely that volatility is going continue in the foreseeable future. And so, I would encourage folks to do is first sit back and take stock, what do you have, what do you owe, and what is your current income? Understanding these three key parts help you understand if you have the capacity to take the risk. It is important that you have 3 to 6 months of emergency fund that will cover your essential living expenses, and also that you expect for income remain fairly stable in the coming months. And also the you don't have any significant amount of high interest rate debt. So like credit card debts or the like. Next you want to check to see if you are OK with putting your money into the market right now. If you put your money, are you gonna be tempted to take out if the market were to fall another 30%. You know the market is currently down around 25 to 30% and depending on when you're watching this, it may be more or maybe less when you watch this, from its recent peak. But when we look back to the financial crisis of 2009 and 2008, the markets fell nearly 50% from their high. And so that helps us understand that the market can still go down. And there is a lot of uncertainty still. We don't know how we're going to respond to this crisis. As far as like government policies that are going to be in place and how markets can react to those policies. We also don't know how the virus itself is gonna change on the ground and how the situation with combating virus is going to change. Those both lend to a situation where this going to likely be continued volatility. And then the next thing I would ask folks to look at what are your goals. If you have a portion of cash on the sidelines right now, and you're saving that for specific purpose, you are saving it for a down payment on a home or starting a family and all