What to do in a bear market?

 

Wall Street is officially in a bear market, as investors are worried about inflation and higher interest rates. How should the average investor react? How long will it take to ride this out?

CBS 58'S Bill Walsh spoke with Chris Markowski, nationally recognized financial expert about what to do. His advice for most people is probably something you've heard before, stay the course "no time to panic if you own high quality companies," Markowski said.

But there is a certain type of investor that should run, not walk, to check their portfolio. The investor who went with riskier stocks at the expense of so-called blue-chip stocks "a lot of high-flying companies out there, dollar-and-a-dream, earnings don't matter, grow at all costs-- they're falling apart. If your portfolio is filled with those things, you do not want to stay the course. You better make some changes, because a lot of those companies are not going to come back," he said.

Every investor's situation is different, but Markowski says the bear market could be thought of differently, a chance at a discount "the funny thing about the stock market is, when it throws a sale, everybody leaves the store." he said.

Bottom line, Markowski says the bear market is no reason to deviate away from a solid, long-term financial plan "I don't care if the market is down 800-points like it was yesterday, if that's the day you put money into your 401k, you do it." he said.

How long with this bear market last? Almost every one in history has returned to previous highs within a few years.