‘Don’t panic, don’t make changes’: Advice for Canadians watching savings shrink during market chaos

Andrew Johnson explains why financial planners are advising Canadians to keep calm and stay the course with their investments amid market volatility.

If you’re compulsively checking your retirement savings during the market volatility fuelled by tariff fears, you’re not alone, but experts advise resisting the urge to make any dramatic changes to your portfolio.

“The average Canadian shouldn’t really be doing anything. If you look over the course of the last 70 years, these things happen about four times a decade,” said Langley financial planner Peter Cishecki. “Don’t panic, don’t make changes. You can’t time the market, and the best thing is to not make an emotional decision.”

Cischecki doesn’t recommend everyday investors stick their head in the sand -- the ostrich approach, as he calls it -- but to remember investing for retirement or your children’s education is a long-term, big picture savings scenario.

“People have to remember you have not lost anything if you do nothing. The value of your account has dropped versus what it was the day before if you’d sold it the day before or if you sell it today. But if you don’t sell there’s no losses.”

He points to Elon Musk’s reported massive losses due to the drop in Tesla stock.

“Elon Musk hasn’t lost anything because, guess what? I’m willing to bet you Elon Musk didn’t liquidate all of his Tesla stock,” he says.

Another example, said Cischecki, is what happened during the pandemic.

“When COVID hit and the market dropped 36 per cent in six weeks, it rebounded for one of the best years ever by the end of 2020. Imagine if you’re that person who sold right near the 36 per cent drop, but you missed the next six months of rebound.”

For Cischecki, the market recovering is a matter of when, not if.

“You’re 15-25 per cent lower than the peak, and we will get to the peak again. When? We don’t know. But we know we’ll get there, as history has shown in the past 100 years.” He adds there is also opportunity right now for anyone who has cash on hand and is looking to invest. “You’re buying things that are definitely artificially on sale. You could come out of this in pretty good shape.”

Cischecki recommend reaching out to your financial advisor for guidance, to calm your nerves, or if you’re nearing retirement.

“This is when your registered financial planner should be reaching out to you. I know which one of my clients are the nervous type, the ones who will look at it constantly and keep themselves awake at night. This is when (your advisor) should be there to hold your hand or keep you up to date on what to expect.”

A final word of advice – put things in perspective.

“You may look at this significant reduction in value in your retirement savings over a very short period of time, but I’m willing to bet if a lot of you look at your value now and you compare your value a year ago, you’re not that far off,” Cischecki says.

“Maybe it means no growth in the past year because a lot of that growth has been wiped away, but it’s not like you’ve had the last 10 years of growth wiped away. And it’s not like you can’t have all that come back in a very short period of time.”