Let's say good morning now to the host of How to Money on KFI. It's Joel Larsgard. Okay, Joel, Yeah, markets for you and me, what is the practical effect of these wild swings and drops that we're seeing heartburn.
I'm going to say, is at least one of them, right? I think the like the whip sawing nature. If you're the kind of person who pays attention to what's happening with the stock market most days, it probably has you kind of pulling your hair out a little bit, which I totally get, which is why one of the suggestions I make to people who are in the wealth building phase of their life. They are sticking money in like clockwork every two weeks dollar cost averaging or maybe even
more than that. But if you are kind of on the front end of your investing timeline, don't pay attention. Like I have not looked at my portfolio balance because I know that if I do, then it's just going to unnerve me in a way that I don't need to be unnerved because I have so much time on
my side before I need to access those funds. So yes, it is frustrating as an investor to see but in particular for people who are, hey, I've got a decade plus before I start tapping my retirement funds, then I think this is more noise that you don't need to incorporate. You don't really need to do anything with it as an investor, You don't need to make any changes.
Okay, so stay the course.
Yes, I mean, it's easier said than done. I think right, it's because when you see market strop as much as they have. The end of last week was insane, and then you see even what happened yesterday, where a tweet can send the stock market soaring by eight percent, and then it's like, wait a second, that was fake news, and then the stock market considers investors start pulling out again.
All of that stuff kind of if you're riding the wave, the day to day wave, the minute to minute wave, you are going to be freaking out and you're going
to be making changes. And the truth is, when we're just doing the boring, slow and steady passive investing approach in index fund just what I talk about most of the time, or target date funds, then all those little machinations, the minute to minute moves shouldn't matter very much to you at all, and in fact, you don't have to pay attention to any of it.
Okay, so just just ignore it. This is we're in this for the long term. Yeah, okay, So I know I'm going to get that an answer to this question. But we were talking with Courtney Donaho from Bloomberg a minute ago, and one of the topics we didn't get to was that people are rating their four oh one k's for emergency cash. I think I know your answer, but is that okay?
Well, so now there's recent legislation that allows people to take a thousand dollars out of their four to oh one k, you know, essentially no questions asked. And I you know, a thousand bucks is one thing, I guess, But when we're talking about taking more than that out of our four oh one k, I don't think it's a good idea. And what happens so often in crazy
market spells like this. I still remember in two thousand and eight talking to friends that I worked with right who were like, I'm really scared about how much the market stopping. I am going to take some money out
put it on the sidelines. Well, that has multiple impacts. One, it's hard to know or you take like, if you're taking money out now after a big drop, you're locking in those losses and then you have a really hard time to know when you should be putting that money back in, on top of the potential tax consequences of pulling money out of a four roh one k early. And so I think your best to leave your retirement
accounts alone. And if at the end of this whole saga, when the market has steadied a little bit, you say I don't I was emotionally incapable of handling that, then you need to have a different approach to your investments. Let's say you're eighty percent invested in stocks, Well, you probably need to smooth out the right a little bit and have a more diversified portfolio, because you realize, at least for yourself emotionally, it's too difficult to handle that
much stock exposure in your life. So that's one thing to consider. But you don't want to make any massive changes kind of when all the turmoil is happening.
Okay, So yeah, I think that's kind of the message that I'm hearing from a lot of people is, you know, don't have a knee jerk reaction to this, because I know that we all feel like, oh my god, what's happening to all my money? But just it's gonna We're gonna have to write it out. It might be a little tough, but eventually we should be okay, we hope.
Yeah, And we're starting to see signs at least that hopefully this tariff regime isn't going to stick around long term, that this is a negotiation tactic. It's hard to tell though, right, Like it's hard to know what the end game is here and how this all shakes out and what sort of you know, deals we come to with trading partners around the world. But I think the great thing is American capitalism of any place in the world, Like we
are the most resilient country. We have incredible businesses that will find ways to prosper even in a tough environment like this.
All Right, the host of how to Money on KFI Jewel Guard. You can listen to him every Sunday from noon to two, and just like this morning, he's gonna have more great financial advice for you. Thank you so much, Joel.
Thanks Amy,