“If you need the money in one, two or three years, you should not be in the stock market to begin with,” the Grand Haven financial adviser said.
Terrill said she made a lot of phone calls to clients last week in anticipation of a market upset because of the federal debt ceiling decision.
“Frankly, every time government makes a decision, we see a fall,” Terrill said. “There’s an unknown and the big investors pull out, which causes the fall. The small investors panic and sell. Then, the big investors jump back in.”
Terrill said she’s had many clients call her this week for reassurance.
“Emotion drives the market,” she said. “When we use emotion to make financial decisions, we are going to make mistakes. The market goes up, the market goes down, but the market always comes back up.”
Chris Tanke, president of Strategic Wealth Management in Grand Haven, said he thinks the next two to three years may be “pretty rocky.”
“I think it’s important that investors — and especially retirees — make sure that the money they have exposed to the markets is money they don’t need to touch for seven to 10 years,” Tanke said. “If they’re using that money to draw income, they’re going to get heartburn watching this. The markets are going to be volatile. If you’re going to be in the market, you have to give them time to perform.”