investing

5 bad financial decisions and how to recover

Investing » 5 Bad Financial Decisions And How To Recover

Confusing long term with short term
Next
2 of 7
Back
text

There are active management strategies in which a preset event triggers a decision to buy or sell. And then there is random flailing. That would be the strategy in which investors randomly sell positions after losing money and then buy back in after the market recovers.

"One of the biggest mistakes is when you start looking at your long-term investments as short term," says Carlo Panaccione, founder and president of the Navigation Group in Redwood Shores, Calif.

That's most likely to happen "when people decide I'll get out (of the market) until things look better. But by the time things look better, the market has already recovered," he says.

How to recover: If you've jumped out of the market, dollar-cost average your way back in. Dollar-cost averaging involves investing a set amount of money on a regular schedule, regardless of market moves.

"Put in a little bit every month over 12 or 24 months. If the market goes up, you'll get some of the upside. And if it goes down, you'll buy it cheaper," says Panaccione.

If market volatility will worry you in the future, meet with an investment adviser to devise a plan for the next time the market tanks.


advertisement

          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

CDs and Investment

Start retirement savings at 24?

Dear Dr. Don, At age 24, I recently started a job working for a corporation. I'm interested in individual retirement accounts. I'd like to look at investing in stocks and bonds and learn more about choosing a 401(k) plan.... Read more

advertisement

Blog

Sheyna Steiner

McDonald’s horrible, no good year

McDonald's returns have floundered in 2014. Are consumer tastes changing or is this a mere blip on the radar for the legendary fast food chain?  ... Read more

Partner Center
advertisement

Connect with us