The stock market has plummeted recently: the real estate boom has fizzled, virtual currency has fallen, and bonds are dreary. So today, let us discuss how to invest and manage money when the investment market is less than optimistic. There are three things for you to consider:

❶ Use of funds and investment timeframes

When the market is trending downward, many people’s first instinct is to preserve capital. But is capital preservation the right approach? It depends on how the funds are used and when the investment is made. You can simply divide your funds into three timeframes: short-term, medium-term, and long-term.

Short-term refers to assets that need to be realized within one to three years and will be used soon. If, given the current economic insecurity, it is uncertain whether the investment will perform well in one to three years, then it is recommended that the investment of this asset be focused on capital preservation.

If the funds are intended to produce in more than three years, they can be regarded as medium- and long-term funds. With these funds, you can actually take advantage of market falls and buy on dips, so that your investment costs will drop. In this case, market falls can be a good thing.

❷ Check your investment ability

The difference between investing and gambling is that gambling depends on luck. Although investing also includes an element of luck, good investing relies on knowledge, information, and technology to improve your chances of winning against luck. Therefore, consider your situation. If you lack the knowledge needed to invest wisely and have poor time management skills, the better option is to leave the investing to a trusted professional and use the wealth management products designed by financial institutions, such as mutual funds, linkage type Bonds, insurance, savings annuities, etc. If you are professional and good at time management, you can consider picking individual stocks to invest in yourself.

❸ Plan investments according to your age

Members of different age groups have different risk tolerances. When the market falls, the ability to recover assets will affect everyone’s life and financial needs differently. Therefore, people of different age groups should have different plans. If you are in the 20 to 40-year-old age group, it is recommended that you invest aggressively to maximize profits. If you are in the 40 to 55-year-old group, because of the heavy financial burden, it is recommended that your investments balance offense and defense with a focus on generating a stable return. If you are over 55 years old and entering the retirement, it is recommended that you approach the market more conservatively. Instead of taking on too many risks and making mistakes that can’t be undone, focus on capital preservation.

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