It's never easy to ride out a market downturn or even just a period of volatility. It can be tempting to panic, sell and abandon your investment plan, but that's what the market is counting on as per Best Financial Advisors Melbourne —and it will only make things worse in the long run. Here are some tips on how to stay strong during volatile times:

Remain calm: Avoid panic selling

You've worked hard to build your investment portfolio, and you don't want to let market volatility drive you into making any drastic decisions. Here are some tips for staying calm during times like these:

• Don't make any drastic changes to your portfolio. If the market has been down recently, there's no reason to think it will continue that way indefinitely. In fact, over the past five years (through November 2018), the S&P 500 has averaged an annual return of 14%.
• Keep investing in stocks as part of your diversified retirement strategy—it's still one of the best ways to grow wealth over time! A well-balanced mix of stocks and bonds is the key to financial security; don't get too scared by short-term drops in value if you're focused on reaching long-term goals such as paying off student loans or buying a home within 5 years or less (not counting emergencies).
  
  
  

Don't make any drastic decisions: Stay the course

The first rule of thumb when markets are volatile is to not panic. In fact, as per Best Financial Advisors Melbourne the best thing you can do during a market correction is nothing at all. Don't make any drastic decisions: Stay the course.

Your portfolio should be structured so that it takes into account your risk tolerance and time horizon – which means that if you don't change anything right now, then your investments will still remain well-balanced over time, even though they may fluctuate in value from day to day or week-to-week. If anything, these fluctuations can help keep your portfolio on track toward reaching its long-term goals by rebalancing when needed (for example, selling some stocks when they're doing well so that you can buy them back later at a lower price).

Understandably, this can be difficult for investors who feel like their financial security has been threatened and want to do something about it immediately—but doing so could cause more harm than good under current circumstances.

Stick to your financial plan: Understand your risk tolerance and stay invested

• Understand the risks: The first step is to understand your risk tolerance and stick to your plan.
• Don't panic sell: The second step is not to panic sell, which will only make things worse for you in the long run.
• Don't make any drastic changes: Finally, don't make any drastic changes right now.
  
  
  

Review your asset allocation: If changes need to be made, adjust slowly

Some asset classes have performed very well in the wake of Brexit and other economic news, such as gold. If you own these types of investments and are considering selling them for whatever reason, keep in mind that it's normal to be emotional about financial decisions after big events like this one. You may feel anxious or frightened, but it's important to remember that your actions should be made based on your financial situation and not based on what others may think or what the media reports.

To help prevent emotional decisions from getting in the way of your investment goals, remind yourself that there is no "right" way to invest during periods of volatility - only options that fit with your goals, needs and comfort level. Then review how each asset class fits into your portfolio before making any changes at all (and make sure they're still suitable now).

Reevaluate your budget for a more stable future: Create a rainy-day fund

If you don't have enough savings to cover an emergency, it's time to start building up that rainy-day fund. The amount of money you should save depends on your income and expenses and also whether or not you have other debts, but the general rule is that saving 10% of your take-home pay is a good start (some financial planners recommend saving even more). Once you've set aside some money in an emergency account, don't touch it unless there's an actual emergency—but knowing it's there can help calm any nerves when markets get rocky.

Conclusion

The Best Financial Advisors Melbourne suggests to stay strong during the recent market volatility means keeping a steady mind and staying on course. Don't panic, and don't make any drastic changes to your investment strategy—stick to what you know and trust. Remember that long-term investing still works, even in times of high volatility; just remember to reassess your financial plan from time-to-time so that it reflects your current situation and goals.