38% of Investors Pulled Money From Stock Market Due to Current Events in the Past Year
MagnifyMoney Survey Finds Many Young Investors Who Withdrew From the Market Regret Their Hasty Decision
CHARLOTTE, N.C., May 16, 2022 /PRNewswire/ -- The traditional advice is to hold on to investments during turbulent times but a new MagnifyMoney survey finds that some investors are going against the experts. Due to the current events of the past year, nearly 40% of investors say they have pulled money from the stock market, with many regretting their knee-jerk reaction.
The survey found that younger investors are more likely to pull money from the stock market, with 67% of Gen Z investors and 57% of millennial investors doing so. However, if these investors are in it for the long haul, they possess one of the most valuable assets, time.
"Time is the ultimate weapon when it comes to investing," says Matt Schulz, Chief Credit Analyst at LendingTree. "It gives younger investors a huge advantage over their older counterparts. Unfortunately, however, Gen Z and millennials risk squandering that advantage if they pull their money out of the market when times get tough. Their best move is to stay focused on the future, leave their money in the market, ride the wve and trust that better times are ahead because history has shown that when it comes to the stock market, they almost always are."
Not waiting it out could be why a large number of young investors are more likely to have regrets. Approximately 45% of Millennial investors who withdrew from the market wish they hadn't, along with 39% of Gen Z investors.
While a portion of Americans pulled out of the stock market due to current events, many shifted their focus to saving for emergencies. Looking back on the turbulent past year, the survey shows that more Americans are seeing the value in building up their emergency funds. In fact, among those who said current events affect their money decisions, focusing on emergency savings was the top priority for nearly half (46%) of them.
4 tips for investing in the stock market during turbulent times:
MagnifyMoney commissioned Qualtrics to conduct an online survey of 1,050 U.S. consumers, April 15-20, 2022. The survey was administered using a non-probability-based sample, and quotas were used to ensure the sample base represented the overall population. All responses were reviewed by researchers for quality control.
MagnifyMoney.com, a subsidiary of LendingTree, makes it easy for consumers to shop for the best financial products and get answers to their most important financial questions. MagnifyMoney's unbiased advice and comprehensive product database helps millions of people compare credit cards, loans, checking accounts and savings accounts. MagnifyMoney's newsroom of personal finance experts is dedicated to helping people save money and lead financially healthier lives through strategies and tips for avoiding fees, getting out of debt, paying off student loans, avoiding consumer scams and other financial topics. MagnifyMoney was launched in 2014, was acquired by LendingTree in 2017, and is based in New York, NY. For more information, please visit www.magnifymoney.com.
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