Is now the time to pull your money out of the market?

Close your eyes for a moment and imagine this scenario.

You’re sitting in a comfortable chair on a sunny day, looking out at a beautiful view with blue skies stretching for miles. Then, near the horizon, you notice storm clouds gathering. Eventually, they block out the sun, darkening the sky and bringing the sound of thunder. Before you know it, you’re caught in a downpour.

What do you do?

For most of us, the answer is simple: we go inside. At the very least, we grab an umbrella or put on a raincoat. Our instinct is to do something, anything, to avoid getting wet.

That same instinct often shows up during market volatility. Watching your 401(k) or retirement account decline – even if those losses are only temporary – can feel unsettling.

If you’re wondering whether to pull money out of the market, you’re not alone – it’s one of the most common questions investors ask during uncertain times.

SHOULD YOU PULL MONEY OUT OF THE MARKET DURING A DOWNTURN?

In most cases, pulling money out of the market during a downturn can make it harder to reach long-term goals. Market volatility is a normal part of investing, and trying to time when to exit and re-enter may increase the risk of missing potential rebounds.

For many investors, the urge to act leads to a common strategy – moving to cash or trying to predict market declines. But reacting to short-term movements can work against a long-term plan.

WHY MARKET VOLATILITY CAN LEAD TO EMOTIONAL INVESTING DECISIONS

The economy plays a major role in financial markets, and it naturally moves through cycles of growth and contraction. These cycles can include bear markets, downturns and even recessions. While they can feel alarming, they are a normal part of long-term investing.

Still, when markets drop, emotions can take over. Losses – even temporary ones – can feel more urgent than the prospect of long-term gains. That’s why investors sometimes make decisions based on fear or uncertainty rather than strategy.

The key is:

• recognizing that volatility is expected; and
• building a plan that accounts for it before it happens

WHAT IS MARKET TIMING – AND WHY IS IT SO DIFFICULT?

Market timing is the attempt to buy and sell investments based on predicted market movements. While it may sound appealing, it requires getting both the exit and re-entry points right, which is extremely difficult to do consistently.

When investors try to time the market, they face two critical decisions:

1. When to get out before the market drops
2. When to get back in before it recovers

Even experienced investors struggle to do this consistently. And because markets can shift quickly, missing the right moment – even by days – can have a lasting impact.

WHAT HAPPENS IF YOU MISS THE MARKET’S BEST DAYS?

Some of the market’s strongest gains happen during periods of volatility – often shortly after declines. That’s why staying invested can be so important for long-term results.

Consider this:

• Strong market rebounds often follow sharp downturns
• These rebounds can happen unexpectedly
• Missing just a handful of the best-performing days can significantly reduce long-term returns

So, you can see – trying to avoid short-term losses could mean missing out on future growth.

HOW TO INVEST DURING MARKET VOLATILITY

Instead of reacting to market swings, many investors focus on what they can control:

• Stay invested and avoid reacting to short-term market movements
• Maintain a diversified portfolio aligned with your goals
• Revisit your strategy when your life changes (rather than the markets)

Having a clear plan can help reduce emotional decision-making – even in the face of unsettling geopolitical events – and keep your focus on long-term outcomes.

Money on Your Mind Podcast, April 2026

HOW A FINANCIAL ADVISOR CAN HELP YOU STAY ON TRACK

During uncertain times, it can be helpful to have guidance grounded in both strategy and perspective.

A financial advisor can help you:

• Align your investments with your long-term goals
• Build a diversified portfolio designed for different market conditions
• Stay disciplined during periods of volatility

Instead of trying to predict what the market will do next, working with an advisor can help you stay focused on what matters most – your financial future.

FREQUENTLY ASKED QUESTIONS ABOUT MARKET DOWNTURNS

Is it a good idea to sell stocks during a market downturn?

Selling during a downturn can lock in losses and make it harder to benefit from a recovery. Many investors choose to stay invested to maintain their long-term strategy.

When should you pull money out of the stock market?

The decision should be based on your financial goals, timeline and risk tolerance – not short-term market movements. Major life changes may warrant adjustments, but reacting to volatility alone can be risky.

How do you protect your portfolio during market volatility?

Investors often focus on diversification, maintaining a long-term strategy that’s designed to help mitigate risk, and avoiding emotional decisions. Working with a financial advisor can help ensure your portfolio stays aligned with your goals.