In early 2025, the stock market feels more unpredictable than ever.

Some days it takes a nosedive, while on others it makes miraculous recoveries no one was predicting.

You may even be worried about an oncoming bear market or stock market crash.

A person looks at the current price and performance of a stock on his laptop.

The difference between a bear market and a stock market crash isnt exactly precise.

Both are defined as a 20% drop from the stock markets most recent highs.

But a crash typically happens rapidly, whereas a bear market is a prolonged period of decline.

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Stock market crashes are, unfortunately, normal.

From 1929 to 2024, the stock market crashed 21 times.

Its inevitable it will crash again.

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We just dont know when.

Now the good news: Historically, the stock market has always recovered over time.

If you put a good plan in place now, yourfinances should bounce backnext time the market crashes again.

Youll soon find out one of the best ways to protect yourself is with a bulked up emergency fund.

Itsnot exactly helpful to give adviceaftera bear market has made its presence known.

That means now is the time to take action to mitigate potential damage.

Or they dont invest when stocks are surging because they think the market is overpriced.

The problem is even the best minds on Wall Street cant predict the markets highs and lows.

The stock market could stay hot for a long time.

And if you cash out after stocks have already fallen, youll lose money or seriously diminish your returns.

A better strategy is to practice dollar-cost averaging, which means you invest a set amount at regular intervals.

The same goes for if you automatically invest each month in a Roth IRA ortraditional IRA.

If youre younger than 59 12, you could also face early withdrawal penalties.

If you dont have at least a six-monthemergency fund, make building one a high priority.

Of course, this is a long-term goal that may take years to achieve.

But any safety net youre able to build is a win.

take a stab at budget at least 10% of your paycheck for emergency savings.

If youre approaching retirement or youve already retired, its especially important to verify you have ample cash reserves.

Consider meeting with a fee-based financial adviser if youre retired or plan to retire in the next five years.

After the stock market recovers, you’re free to rebalance your portfolio.

You brew coffee at home, you dont walk into Target and you refuse to order avocado toast.

(Can you sense my millennial sarcasm there?)

Whenever you invest in stocks, you risk losing money when the market goes down.

Because its natural to panic when stocks nosedive, make a plan now.

This may seem counterintuitive to what we said about not trying to time the market.

What Should You Do When the Market Crashes?

Keep investing in your 401(k) after a crash unless your financial situation has drastically changed.

Avoid checking your account daily.

Its never pleasant to see your net worth nosedive.

But if you dont sell your investments at a loss, you really havent lost money.

With time and patience, your finances will eventually recover.

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Millions of Americans ignorethese easy tipsthat could have you padding your wallet in no time.