Let’s face it, we have known for a while that a recession was coming. I’m sure you’ve been hearing for the past couple of years that this bullish market couldn’t last forever and with the global spread of COVID-19 we have finally seen these financial gurus’ predictions come true. Now, for many, this global recession means losing their job, seeing their retirement account evaporate or even losing their homes and while this is tragic to put it lightly, there are always opportunities even in the darkest times which is why, in this article, I will share with you 5 ways to profit during a market crash!
Now I know that during this uncertain time, optimizing your finances may be the last thing on your mind but I wouldn’t be doing my job if I wasn’t sharing with you how to not only survive the current recessionary period we are facing but how to thrive and come out better than you could ever have expected which if why I believe that reviewing your finances and making smart decisions must be on your agenda during this tumultuous time.
But instead of sitting around trying to gauge the market bottom and trying to predict when things will turn around, I recommend you focus on these 5 key areas instead.
Number 1: Control Your Emotions
The first thing you absolutely must do during a recession is to keep your cool. If you’re big into investing, times of financial recession can have you seeing your portfolio drop 30,40 or even 50% or more and this certainly doesn’t feel good. For those who invest with money they simply cannot afford to lose, their initial reaction to seeing their holdings drop this much is to pull out their money to salvage what they can. Unfortunately, this is the quickest way to ruin your financial state and avoid making a profit during a market crash. Now, let me add one caveat that if you need to pull out some money to cover your core expenses of utilities and groceries then that’s fine but otherwise you need to let your money ride out this financial hardship and here’s why. You see, when the market declines and you realize double digit decreases in your portfolio holdings, cashing out your money makes it nearly impossible to recover.
Think about this. If you were to invest in a stock or ETF, what would you deem a good return? 5%…