For financial goals that are in the near future, whether that means buying a house or paying for retirement, it's important to have a sufficient amount of money set aside in stable investments such as bank accounts, certificates of deposit, money market accounts and short-term Treasuries. That reduces the chances of having to sell stocks during a bear market to raise cash to meet the goal. In other words, an important part of any bear strategy is having enough cash to pay for near-term goals. A lengthy market decline can mean it is time to recalculate how much money and time will be needed to achieve long-term goals. The worst thing that you can do is try to predict how long and how low markets can go.
Upward moves happen unexpectedly.
The more worried we are, often the larger the move when there is an upside. But, if you had missed just 10 of the market's best days during that bull run, you would have missed 30 percent of the market's return. If you had missed the 20 best days, you would have missed half of the potential return from that bull run, Holzberg said. Kathy Kristof is a personal-finance columnist with the Los Angeles Times. She welcomes comments and suggestions, but regrets she cannot respond personally to every inquiry.