— and it’s one that experts say isn’t advisable for those who’ve been laid off or are currently taking financial hits. But for millennials with stable income streams, current market prices may offer an opportunity to scoop up quality stocks at low prices.
“It’s not money, it’s part ownership and shares of a company that currently is trading at a lower value than history tells us it’s worth, so 1/8 from3/8 that perspective, I don’t feel panicked when I look and see that my $5,000 that I transferred over is now only worth $4,800,” Palios says. He suggests new investors start with diversified portfolios, like ETFs or mutual funds, and use dollar-cost averaging to grow their assets over time. The latter approach is proven to work primarily because it prevents investors from making large lump-sum investments that are poorly-timed with stock market prices.
He suggests a low-risk approach for first-timers and veteran investors alike in times of market turbulence. If you’ve been laid off or are facing financial difficulty and don’t have emergency savings to turn to, there’s no shame in reducing your contribution or selling your stocks off, even at a loss, Choi says.