Finding calm and stability during volatile markets
Have you been watching the market turmoil, anxiously trying to figure out your next investment move? You’re not alone: only 17% of working Americans say they don’t panic when their investments hit a bad patch.1 During turbulent market conditions, financial professionals like me typically receive an influx of phone calls and emails from clients who are trying to successfully navigate market volatility.
This worry is understandable, with the charts and graphs telling the story clearly. Recently, economic events have played a role in causing a significant amount of market volatility. While the youngest Gen Z investors likely have time on their side to ride out any volatility by maintaining longer positions on their investments, many millennial, Gen X, and baby boomer investors may be feeling anxious due to the unpredictable market movements. They may be alarmed or concerned by changes or dips in their 401(k) or IRA account balances and other investments, but most people, especially those approaching retirement, do not have the luxury to hold their market positions indefinitely. No matter how much time you have to stay the course, or how much investing experience you have, there are resources available to help you.
Avoiding “panic moves” during volatile markets
Some common mistakes during volatility or down markets are what some call “panic moves,” which are to be avoided, not only because of the consequences they could have today, but also the impact they could have in the future. Don't panic and abandon your savings plans just because there is a temporary market downturn. Make your best effort to keep saving as much as you can. In addition, it’s best not to sell market assets in a hurry at the low point in a poorly timed effort to take care of debt. If you have savings in place, and some liquidity already available, consider approaching debt management in a thoughtful way instead of a reactive way.
As stressful as market volatility may be, trying to navigate it alone may compound that stress. During times of uncertainty and volatility, as your trusted financial professional, I can offer a calm, level-headed, and knowledgeable approach to achieving financial confidence. According to Guardian’s Mind, Body, and Wallet® research brief, those who responded that they work with a financial professional were more likely to be associated with high financial health.
Dive into diversification
Volatility may feel especially jarring for those who are nearing retirement. During times of great volatility, I may have a conversation about diversification with my clients. A mix of financial products that may include annuities and whole life insurance can offer a diverse portfolio that makes you confident.
An annuity is an insurance product that can guarantee income. Annuities can help grow and protect savings and can also provide a potential payout to family upon the policyholder’s death. Some annuities allow long-term growth and offer an option to convert money into a steady income stream that won’t be affected by market changes.
As your financial professional, I can offer guidance to help you select the right type of annuity for your situation. The selection process should include a discussion about risk tolerance, tax considerations, and other factors. Fixed annuities, for example, have a guaranteed interest rate and are a lower risk compared to some financial products, with taxes due upon withdrawal.* It’s important to consider all the options and then choose the right annuity that is the optimal fit for your needs.
Considering the benefits of whole life insurance during volatility in the markets
A whole life insurance policy can offer financial confidence for your family if you pass away, as well as policy cash value if you need supplemental income later.** The cash value of a whole life insurance policy is not affected by market volatility. When the market dips, withdrawing money from equity-based products can be problematic, however, whole life insurance can provide an alternative source of income even when markets are down.
Whole life does not achieve the level of growth you might see in equity investments during a bull market. During a market downturn, however, a modest but steady return can be attractive and reassuring. Policyholders can find some calm in knowing that market fluctuations do not have an impact on whole life insurance.
Keeping calm, carrying on, and learning from history
If you zoom out and look at the markets over the years, instead of by month or quarter, you’ll see that volatility in the markets is a temporary condition, not a permanent change. As your financial professional, it's my job to provide guidance that can lead to confidence during volatile markets.
DISCLAIMERS:
1 Guardian’s 2025 Workplace Benefits Study
*All guarantees are backed exclusively by the strength and claims paying ability of the issuing insurance company.
**Some whole life policies do not have cash values in the first two years of the policy and don’t pay a dividend until the policy’s third year. Talk to your financial representative and refer to your individual whole life policy illustration for more information. Policy benefits are reduced by any outstanding loan or loan interest and/or withdrawals. Dividends, if any, are affected by policy loans and loan interest. Withdrawals above the cost basis may result in taxable ordinary income. If the policy lapses, or is surrendered, any outstanding loans considered gain in the policy may be subject to ordinary income taxes. If the policy is a Modified Endowment Contract (MEC), loans are treated like withdrawals, but as gain first, subject to ordinary income taxes. If the policy owner is under 59 ½, any taxable withdrawal may also be subject to a 10% federal tax penalty.
This material is intended for general public use. By providing this content, The Guardian Life Insurance Company of America, and its affiliates and subsidiaries are not undertaking to provide advice or recommendations for any specific individual or situation, or to otherwise act in a fiduciary capacity. Please contact a financial representative for guidance and information that is specific to your individual situation.
Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.
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