What should we do,

[elleng]

in light of 'steep selloff?'

http://www.democraticunderground.com/1014717603

[Common Sense Party]

1. Everyone's response will (and should be) different.

In my case, I'm doing nothing--other than looking for some bargains. But I have 20 years until I retire.

And I don't call 5% all that steep.

Those that are more risk-averse and getting closer to retirement should have reduced their equity exposure (% of their investments in stocks) while the market was up last year.

[SheilaT]

2. What Common Sense said.

If you're in it for the long term, you may not want to sell. As someone at the linked discussion pointed out, this may be a good time to go shopping.

I'm certainly not planning on selling anything.

The stock market goes up. It goes down. It repeats.

[lastlib]

3. Over the long term it goes up more than it goes down.

think long-term, unless you're close to dying--in which case you chouldn't have much exposure to equities.

Right now--look for buying opportunities. The market isn't down, it's on sale. Five percent off, this week only! Maybe next week seven percent off! (pays yer money, takes yer chances.....)

[SheilaT]

4. Yep.

It's the people who panic and start selling at the first downturn in the market that provide the buying opportunities for others.

During that period of time that the stock market was closed after September 11, 2001, my sister called me and asked what I thought she should do when it opened back up. Sit tight, I said. Sure, there will be a decline at first, but then it will come roaring back. Which is pretty much what happened.

I have a financial adviser I trust, and overall I'm doing quite well. What's also interesting is that in the long run the very worst thing you can do is be totally in bonds, or totally in cash.