WSJ Your Money Briefing - How to Invest Amid a Market Freakout

Episode Date: April 14, 2025

After a historically chaotic week for the stock market, uncertainty about the scope and impact of President Trump’s tariffs means that more market volatility is on the horizon. Wall Street Journal reporter Imani Moise tells host Ariana Aspuru what day-to-day investors should know about navigating what’s ahead. Further Reading:  Here’s Why You Shouldn’t Check Your Portfolio Right Now  How to Make Major Money Decisions Right Now: A WSJ Guide  Sign up for the WSJ's free Markets A.M. newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Hey, your money briefing listeners. This is Arianna Aspuru. Here at YMB, we're all about bringing you important personal finance and career news. We're working on making some changes to our personal finance content, and we wanna hear from you. Our question today is,

what kinds of life issues related to money do you wanna hear more about? Work and career, relationships and money, wills and estate planning, or retirement. If you're listening on Spotify, look for our poll under the episode description, or you can send us an email to ymb at wsj.com. That's ymb at wsj.com.

Now onto the show. Last week was one of the most volatile for the stock market in history. Trillions of dollars of investors cash was added and then erased by the day. That's met a lot of uncertainty about how it'll affect the economy and your money. This week on the show, we're looking at what the recent market mayhem means for things like your investments and savings, mortgages, taxes, and more. This is your money briefing.

It's Monday, April 14th. I'm Mariana Aspuru for The Wall Street Journal. It's Monday, April 14th. I'm Arianna Aspuru for The Wall Street Journal. We kick things off by looking at how the ups and downs in the market might affect your day-to-day investing. You cannot control this market. No one can control the market. So just get used to that feeling of being out of control a little bit and don't let that feeling allow you to lose sight of your plan. So if you're considering your next move right now,

should you sell, buy the dip or wait it out? We'll talk with Wall Street Journal reporter Imani Moise about one for the markets. The back and forth on President Trump's plans for tariffs has disrupted stock indexes and the bond market and shaken up Americans' finances. My colleague Imani Moise joins me to talk about what this means for the everyday investor. Imani, there's a big question on a lot of people's minds right now. Should I do something with my money? What do financial planners say to that?

Financial planners are telling most of their clients just to stay calm and be patient. And what happened last week is a perfect example of why that's often the best advice. For example, if you saw the market decline last Monday and you took that as a sign to sell, that means you would have missed the rally just two days later. And if you took that as a sign to sell, that means you would have missed the rally just two days later. And if you saw that historic jump on Wednesday and you saw that as a sign to buy, then you'd probably be disappointed the next day

because markets slid again. So basically what financial advisors are telling their clients to expect is more of that. A lot of volatility over the next few weeks, maybe months, as the economy, markets, figure out what's really going on. And when things are going back and forth that quickly, it's not really a good time to make big decisions. And you wrote another story recently

that we'll link in our show notes about how now is not the time to check your portfolio because you might be spooked into making an impulse decision. What are some things you should keep in mind if you do want to sell? You should remember the long-term trajectory of the market. It's still an upward trend. And the reason that advisors say,

don't check in on your portfolio every day, especially in a time like this when there's a lot of volatility, there is almost a 50% chance that you're going to catch it on a down day. Now you can use a market downturn as an opportunity to sell if you want to take advantage of tax loss harvesting. And that is just locking in some losses so that you can use them to offset any capital gains tax at the end of the year whenever your taxes are due.

But if you do that, you want to make sure that you are maybe selling stocks that have been underperforming for a while, not just in this most recent downturn, and make sure that you reinvest fairly quickly. Again, if you take last week as an example, if you sold on Monday and you did not repurchase anything, you would have missed out on that rally on Wednesday. And one advisor told me that's a really bad thing to do for your mental health. Can a turbulent time like this for the market

be a gut check for some investors? Should you take account of how you feel about your current portfolio? Absolutely, especially if you're on the younger side. Because if you've set up your portfolio really in the last five years, then you're on the younger side, because if you set up your portfolio really in the last five years, then you're very used to things going well for yourself. So a lot of advisors are telling me that clients are realizing that their risk tolerance isn't as high as they thought it was when markets were doing really, really well, now that markets

aren't in such great shape. You can use this as a time to be more realistic about your risk tolerance, but you still shouldn't be making any rash decisions. And that's because if you sell right now, you'll be making those losses real as opposed to just theoretical. We saw a major rebound in the middle of the week last week. You've been talking about it. If or when that rebound happens again, is it a time to rebalance your portfolio? Not yet.

And that's according to the advisors that I've been speaking with. And again, that's because of the volatility. At least for the next few weeks, you should expect a lot of big ups and downs going on in the market. And what advisors are really saying that you should hold out for is just a more even keel. When markets aren't moving more than 5% in either direction in the day on a more regular basis, maybe that's when it's time to level set and rebalance and decide how you want your portfolio to look going forward.

When we do see a downturn, we hear the term by the dip a lot. What kind of investor might benefit from that strategy right now? Any investor with a really long horizon. So if you're younger and you have, let's say, 40 years till retirement, odds are the market, the economy, businesses will figure out how to be successful in whatever environment we end up in, which means that the market will do better. So if you want to buy right now, the best advice is to do what's called dollar cost averaging.

And that's really just setting a set amount, a set dollar amount, so whether that is $100 or $1,000, however much you have to invest, a week or a month into the market at a regular time interval, doing it that way will decrease some of the risk of getting in at the wrong time. Because what you're doing is you're averaging the cost of those shares over a long time. So in the end, on average, nothing's going to hurt too much. Yeah. So you're not putting all of your money in a single dip. It's kind of like money into your 401k or IRA every single month. Right.

And cash is another thing that you've written about too. What do you advise or suggest people do with cash on hand right now? Definitely not stuff it into a mattress. If you are concerned about inflation, which a lot of economists are expecting to go a lot higher if these tariffs settle in and trickle through the economy. You want to make sure that your money is at least keeping up with inflation. You could try a high-yield savings account, but interest rates might come lower. So if you're concerned about that, you can try locking in a rate with a CD or a money market fund.

But it's really important right now. It's always important, but especially right now to make sure that your cash is earning some type of yield. Investors with a lot of stake in the market, whether it be, you know, for their retirement savings or their kids college funds, they might be feeling nervous or even a little bit panicked right now. What's the biggest thing we should remember going into this next week? That is going to be uncomfortable and that is direct quote from one of the advisors that I spoke to. And maybe you should get used to feeling that way.

A lot of times, people make moves during periods of uncomfort to feel a sense of control. You cannot control this market. No one can control the market. So just get used to that feeling of being out of control a little bit. And don't let that feeling allow you to lose sight of being out of control a little bit and don't let that feeling allow you to lose sight of your plan.

That's WSJ reporter Imani Moise and that's it for your money briefing. This episode was produced by me with Deputy Editor Chris Zinsley. I'm Arianna Aspuru for The Wall Street Journal. We'll have more on what the volatile markets mean for your money tomorrow. Thanks for listening.