Ways you can go on offense during this market volatility.

Recent headlines and the market's pullback may understandably leave you feeling uneasy. It's moments like these when Sir John Templeton’s famous insight becomes especially valuable: “The four most dangerous words in investing are: ‘This time it’s different.’”

While the underlying cause of market volatility may be different from that which we experienced during other periods of volatility, the reality is that a market pullback is not unusual or unexpected.

Consider this: from 1980 to 2020, the Standard & Poor’s 500 experienced average annual drops of approximately 13.7 percent at some point during the year, yet still finished positive in 75 percent of those years. Corrections are not anomalies — they are a natural part of the investing cycle. Even during more severe events like the 2020 COVID drop, the S&P 500 fell over 30 percent, only to recover within six months and reach new highs.¹

These data points to the fact that stock market pullbacks are a normal part of the market cycle and should be anticipated. So, while pullbacks can be unsettling in the short term, history suggests that staying invested and maintaining a long-term perspective can help you pursue your goals. Instead of viewing pullbacks as a cause for fear, they should be seen as a normal and even necessary part of the market's health and growth.

It’s also worth noting that some of the best investment days historically come on the heels of the worst ones. That’s why, even though it can feel natural to go into defense mode during volatility, there are some potential ways to go on offense right now.²

Here are a few proactive strategies to consider:

1️⃣ Maximize Retirement Contributions Now and Review Allocations
Consider front-loading annual contributions to your 401(k), SEP IRA, or employer-sponsored retirement plan. (Check your plan to see if this option is available.) It's also smart to review your allocations and see if your future contributions are well-diversified to match your long-term goals. For new contributions, it can be an opportunity to introduce additional diversity.

2️⃣ Contribute to a Roth IRA
If you’re eligible, making a Roth IRA contribution during a market dip may amplify the power of tax-free growth..

3️⃣ Explore a Roth IRA Conversion
Converting traditional IRA assets to a Roth IRA during a market downturn could allow you to pay taxes on a lower balance today, setting yourself up for tax-free growth down the road.
Note: Roth conversions may have tax implications, so it's essential that we coordinate with your qualified tax professional before taking action.

Please reach out if you’d like to discuss any of these strategies or if you just want to share your concerns and see if you're still on track. Remember, you’re not navigating this market alone. Although this time volatility may feel different, history tells us that what follows should hopefully give you a sense of confidence that your long-term strategy remains intact and you remain on track. 

^Source: 

^{1. STL.news, April 6, 2025} 

^{2. CNBC.com, April 7, 2025}