Written by:
Written by:
During a three-week stretch in February and March 2025, the S&P 500 shed about 10% of its value. Double-digit corrections always cause worry and tension, but after two boom years in 2023 and 2024, the drop felt catastrophic.
Inevitably, this left a swath of America wondering if it was time to pull the ripcord. This is understandable. When your net worth has two (or three) commas, even a drop of a few percentage points can feel like a seismic shift. Confusion, worry, and panic set in, and the urge to SELL SELL SELL takes over.
But here’s the truth: this is a normal, expected aspect of investing. And for those with a solid financial plan, it can even be desirable. But it’s difficult to keep this in mind when the headlines are screaming that the sky is falling. So the next time the market takes a nosedive, turn off the TV, put your phone down, and remember these three things:
1. This is the cost of building wealth
According to my econ 101 professor: There ain’t no such thing as a free lunch. This is true in life and especially the market. There is no upside without the downside. Crashes aren’t a bug, they’re a feature. Simply put, there is no magic investment pill offering risk-free returns.
This is the deal you signed up for when you chose to invest in equities; there are risks involved. The “safe” play would be to park your retirement savings in cash or Treasuries and know your dollar will always remain a dollar. But fast forward 25 years and you’ll discover that inflation has quietly stolen half your purchasing power while you slept soundly at night. Turns out playing it too safe is the sneakiest risk of all.
Remember: Markets thrive on volatility, and the goal isn’t to dodge it, it’s to harness it.
2. Timing the market is a loser’s game
We at EWA have collectively sat in thousands of meetings – with everyone from surgeons to CEOs — and have never heard anyone say they got rich by jumping in and out of the market at precisely the right moment. You know why? Because it’s so improbable as to be effectively impossible.
Timing the market successfully requires three things to happen: Selling before the dip, buying back in before the recovery, and doing so repeatedly. The only people swearing they’ve cracked the code are the ones selling you something, usually a newsletter or an online course. That’s why the best strategy, for both your investment returns and your peace of mind, is to buy and hold (with periodic shifts and rebalances). True active investing is a bet most people can’t afford to make.
Remember: Your wealth doesn’t hinge on calling bear markets; it thrives on riding them out.
3. Your portfolio is built for decades, not days
If your portfolio is structured appropriately, you won’t need this money anytime soon: seven years, minimum, before you should even think about touching it. For some, it might be 30 years, or 50, before distributions start. Think early retirement, college for the grandkids, or a shiny new university building. Daily market movements don’t matter when your timeline is measured in generations.
The idea is to align your balance sheet with your lifestyle and spending needs: Income and safe assets (cash, bonds, life insurance, etc.) for short-term liquidity and equities for long-term growth. Customized to be diversified, low-cost, and tax-efficient, the long-term piece of the portfolio is built to compound over decades.
Remember: Stocks are your legacy fund, not your emergency fund.
The plan is the point
With a durable, carefully considered financial plan, you won’t lie awake at night mulling over unanswerable questions like, “Is this the top?” and “When should I get back in?” It’s pointless. The best investment strategy doesn’t demand you predict the future; it’s built to weather it.
So the next time markets tank and the screen flashes red, remember that growth has a cost, timing’s a trap, and you’re playing the long game.
A game you intend on winning.
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Important Disclosures:
Securities and advisory services offered through EWA LLC dba Equilibrium Wealth Advisors (a SEC Registered Investment Advisor).
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
In 15 minutes we can get to know you – your situation, goals and needs – then connect you with an advisor committed to helping you pursue true wealth.
EWA, LLC dba Equilibrium Wealth Advisors, is an SEC-registered investment advisory firm providing investment advisory and financial planning services to clients.
Investments in securities and insurance products are not insured by any state or federal agency.
To view EWA’s public disclosure, registration, Form ADV and Part 2B’s, click here.
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In 15 minutes we can get to know you – your situation, goals and needs – then connect you with an advisor committed to helping you pursue true wealth.