What to do when stocks plummet: Smart moves to protect your retirement saving

Stock markets have been very unstable in March. The S&P 500 and Dow Jones Industrial Average have been going up and down quickly because of the Iran war, rising gas prices, and worries about inflation. Many small investors are feeling nervous. Watching retirement accounts like a 401(k) lose value can make people panic and think about selling their stocks quickly.

Experts say panic-selling is usually a mistake. Selling in fear breaks some basic investing rules: buy stocks when prices are low, sell when prices are high, and avoid emotional decisions, according to USA Today.

Don’t try to time the market

Some investors think they should sell their stocks during a market drop, wait for prices to reach the lowest point, and then buy again later. But experts say it is very difficult to correctly predict the right moment to sell and the right moment to buy again. “Any time you’re trying to avoid a downturn, the risk of being wrong is pretty high,” said Peter Lazaroff.


Lazaroff explained that investors must make two perfect decisions — when to sell at the top and when to buy again at the bottom — which is much harder than it sounds. Market history shows that the worst days in the stock market often happen very close to the best days, said Kristy Akullian, speaking to USA Today in 2025.

A good example was April 9, 2025, when stocks jumped sharply after several days of losses during Donald Trump’s tariff campaign. Staying invested helps people benefit from those big recovery days, said Patrick Means.

Stick to your long-term plan

Experts say the best strategy for long-term investors is often to stay calm and follow their investment plan instead of reacting to short-term market drama. Market drops, known as bear markets, usually do not last as long as periods of growth called bull markets, according to data from Charles Schwab cited by USA Today.

Since 1966, the average bear market has lasted about 15 months, while the average bull market has lasted almost six years. Investment company Vanguard says successful investors usually follow a few key principles: set clear goals, keep a balanced and diversified portfolio. Investors cannot control what the market does, but they can control their reactions and avoid emotional decisions, said James Martielli.

Sometimes the best move is to do nothing

Financial advisers say daily stock market movements should not matter much for people investing for long-term goals like retirement. Experts say stocks are best for people who can keep their money invested for many years instead of needing it soon. “If you need funds soon, don’t have it invested,” said Randy Bruns.

Bruns also said that investors who will not need their money for about 15 years should stop worrying about short-term market swings. Market downturns and recessions often feel long but are usually shorter than many people think, according to USA Today. Long-term investors saving for retirement can usually ride out these temporary market drops, experts say. “If you have the luxury of being a long-term investor, be one,” Akullian said.

Market drops can create buying opportunities

Even though experts warn against emotional trading, falling stock prices can create chances to buy good investments at cheaper prices. The stock market has often been considered expensive in recent years, meaning big bargains are rare during strong markets. When the market corrects, investors may be able to buy stocks at better prices than before.

People worried about the risk of individual stocks can choose broad index funds, which track the whole market and are usually less risky. Another strategy is buying stocks that are less sensitive to big market swings, Akullian from BlackRock told USA Today in 2025. Some mutual funds and exchange-traded funds (ETFs) are specifically designed to reduce volatility by holding more stable investments. BlackRock also provides information about “minimum volatility” investing strategies that aim to reduce big ups and downs in a portfolio.

FAQs

Q1. What should you do when the stock market crashes?

Experts say investors should stay calm, avoid panic-selling, and continue following their long-term investment plan, according to financial advisers quoted by USA Today.

Q2. Is a stock market drop a good time to buy stocks?

Sometimes yes, because falling markets can offer chances to buy stocks or index funds at lower prices if you are investing for the long term, according to experts cited by USA Today.