Investors are Panicking. Great Time to Invest!

Unless you’ve had your head in the sand, and many have, you cannot turn on the news without hearing how the stock market has tanked. I’ve been asked by friends and family alike about if its time to “get out” of the market yet, and the answer is unequivocally NO. (Yes, I still use SAT words!)

But let’s look at it another way—when is the best time to buy electronics, clothing, and food items—when it is on sale, or when it isn’t? If you’re not a millionaire and have people purchase these things for you, the answer would be the former and not the latter. Very few people would advocate waiting for prices to go up before going out to make purchases.

So why not look at the stock market the same way? Prices are being dragged down because of the falling dollar, housing market and credit market crashes, and many stocks are being pulled down in the process. Mortgage-backed securities, which we featured [here] before the decline of the housing market, have driven down the market. Lesson learned, yet we move on.

It’s important to make sure you don’t tailor your investments to one particular sector. This has become evident after the dot-com bubble and now the housing bubble. That doesn’t mean you should avoid housing stocks, but you should make smart choices about including the right ones in your portfolio. And if you don’t know enough about making such a choice (I will freely admit that I don’t), its best to focus on the long-term and invest in mutual funds—especially index funds, which are readily diversified. You may also want to consider Growth-focused funds and some international funds. Check sites like Morningstar for more information.

So now is not the time to bail. There’s a stock sale going on and people are bailing out at the wrong time. If you’re in it for the long haul, consider this as buying your investment for a much cheaper price—and rest assured, these prices won’t be here for long! So act today! But wait, there’s more!

Well, no there isn’t. I got a little carried away. See you next week.