Tori Dunlap is a millennial money and career blogger. After saving $100,000 at age 25, Tori founded Her First $100K to fight financial inequality by giving women actionable resources to better their money. A Plutus award winner, her work has been featured on Good Morning America, New York Magazine, Forbes, CNBC, and more.
In her "Dear Tori" series, Tori answers readers' questions – everything from how to talk to your partner about finances to what debt to pay off first.
“Hey Tori — So the stock market is crashing. And it’s really hard to watch it fall and feel like I’m losing money. I’m anxious and can’t stop checking my account balance. I’ve been hearing from some people to sell, while others are telling me to buy, and it’s just too much. Help!”
I feel you. Hard.
I lost over 30% of my net worth in 3 weeks. That’s a ridiculously-difficult pill to swallow. And yes, like you, feel like pulling my hair out right now.
They’ve literally had to stop trading multiple times in the past few weeks because the market was plummeting too fast.
But you know what we’re not going to do? Panic. If you’re in this for the long haul, nothing about your financial strategy has to change. There’s going to be booms, and there’s going to be busts — and the general rule is to ride it out. It’s like a roller coaster.
But what it sounds like you’re really asking, is how to curb your anxiety over the rise and fall of the stock market (and how to tune out the pandemonium in order to make smart choices.)
It’s normal to be worried about the stock market in times like these, but it’s also important to make sure you’re not letting anxiety about the markets take over. Here’s how to take care of your mental health today (and all days of market craziness) in order to talk yourself off the ledge:
1. Try to focus on what you can control.
Try to focus on what you can control. What’s happening in the markets feels very out of control, and it can feel like there’s nothing we can do but watch the value of our portfolio decline. But there are some things you can control when it comes to your money, even during this extreme volatility. Some of these include: building out an emergency fund if you’re able to, staying focused on your long-term goals, finding efficiencies in your spending, and if you can, consider making additional contributions to your 401(k) (there are some upsides to a down market!) You can use Personal Asset ’s free financial tools to track your progress towards an emergency fund goal, and to analyze your budget to see if you can do any trimming.
2. Review your news notifications.
Review and consider limiting your news notifications. The media does a great job of sensationalizing what’s going on — it helps with their sales but may not help your mental well-being. See what your notifications are and, if you need to, limit some. It’s important to stay informed but some news outlets can drive you crazy.
3. Accept the things you can’t change.
We do not know what the market will do next. Anyone who tells you they know what’s going to definitively happen is lying to you. Keep in mind stocks could recover (or they couldn’t.) At the end of the day, stick to the plan. Stay steady. Throw your hands up in the air and ride the coaster.
4. Remind yourself that you haven’t actually locked in losses until you sell.
A reminder: you have not LOST money until you sell your stocks. So yes, although that line curve is plummeting, you have not technically lost money. Highs and lows are normal.
5. Remember that we’re in this together.
No one is immune to financial stress, even money bloggers like me. This should give you some sort of comfort and solidarity, as all of us are moving through this potential financial crisis together. I’m writing this article to answer your question, but you better believe that I myself am going to need this very advice today, next week, and next year (maybe a tattoo on my forehead will do the trick.)
6. Don't forget to think long-term.
The biggest thing to remember: we’re in this for the long haul. And take care of yourself and your mental space. Put a limit on the news you consume. Only listen to people you trust. And lean on your community during this time of chaos. You’re not alone.