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6 Tips for Investing During Challenging Times

Blog-Date-1Aug 10, 2020

The past several months have been a financially stressful period for many Canadians. Across the country, widespread layoffs, struggling businesses and financial market upheaval have caused headaches and heartache for millions. Against this backdrop, Canadian investors have watched the value of their portfolios rise, fall or hover amid uncertainty. Read on for our 6 tips for investing during these challenging times, and what we can learn from the current situation.

Person reviewing investment documents in front of computer.

Insights for investing during a pandemic

Investing is highly personal, so your needs, objectives and attitudes may differ significantly from those around you. There are no one-size-fits-all solutions, and the best investing advice is always tailored to your unique circumstances.

Keeping this in mind, the following are 6 tips for investing in uncertain times that may be helpful in framing the way you think.

  1. Recognize that uncertainty is a given. 2020 has reminded us that the world is unpredictable and that uncertainty is part of life. Accepting this and ensuring your investments align with your risk tolerance will make investing a less stressful and more rewarding experience.
  2. Understand your financial situation. Any investment decisions during these challenging times should be made within the context of your overall financial situation. Your financial advisor can help you understand the big picture, including your financial needs, risks and opportunities.
  3. Proceed with caution. Market volatility can lead to impulsive decisions driven by fear or greed. When in doubt, pause – and remember that smart investing is strategic and planned. There is no need to rush.
  4. Be informed, not obsessive. Investors have been on an emotional rollercoaster recently following the ups and downs of the financial markets. It’s helpful to stay informed about the news of the day, but try not to stress over every blip in your investment portfolio.
  5. Invest with your time horizon in mind. Some investors see market volatility as an opportunity for short-term gains. However, trying to time the market just right is difficult and risky. As a rule of thumb: the sooner you need your money, the less risky your investments should be.
  6. Maintain an emergency fund. The pandemic has reinforced the importance of having an emergency fund you can tap into when life takes an unexpected turn. Before directing more money toward investments, first ensure that you have a healthy emergency fund set aside.

Guided by investment expertise

There is no doubt that Canada is in the midst of challenging times, which for many has led to increased uncertainty about their investments. Fortunately, investing doesn’t need to be overly complicated, even now – especially if you have a trusted advisor who can guide you through the process.

Investment expert handing pen to client.

At W.A. Robinson, our financial planning team is always here to answer your investing questions and help you gain clarity regarding your financial situation. To get in touch, please call us at 1-877-279-2116 or contact your W.A. Robinson financial planner directly.