The Markets - Has this happened before?

• Since 1950 we have a 10% correction every two years on average. That means the markets will drop 10% about every 2 years.
• Since 1950 we have a 20% or more "bear" market every six years on average. That means the markets will drop 20% or more about every 6 years for varied reasons.
• 100% of the time - our markets recover.

When someone becomes nervous over a market drop and they move their money to bonds or cash while the market is down - they only lock in the fact that their account is down. When we begin the "recovery" period and they are still in cash and bonds, their accounts WILL NOT recover because they are sitting on the sidewalk waving at me as I/we pass them by rather than riding in the market car to a destination. (just to help you remember)

Often someone will boast that they "got out before it got bad" and will "get back in when it gets good." The meat of portfolio recovery often happens while they are still on the sidelines.You're not sitting at a blackjack table trying to figure out when to take your winnings. This is investing - investing is like a marriage. You have good times, bad times, bear market infidelity (haha) and rebalancing of priorities.

If you have access to a Roth 401(k) or a Roth IRA - you need to make sure you are maximizing your contributions. If you qualify to contribute to a Roth IRA or your employer offers a Roth 401(k) you are putting money into your account now and when you retire you pay ZERO tax. You can afford to pay the tax now because you are employed. When you are retired either by choice or by force (health) you need every penny in your account to be income tax free.

If your income prohibits you from contributing to a Roth IRA, then you still have great cause to contribute to your Traditional 401(k). As long as you are contributing to something you benefit every single day the markets are down because your newly invested money has great opportunity for growth.