Many investors are facing an internal struggle: We know we need to invest, but a volatile market makes yearn for “safe” places to put our money.

Why? Because we experience losses about twice as severely as equivalent gains -- a phenomenon known as “loss aversion” in the world of behavioral economics.

Loss aversion and other biases can cause us to act irrationally. A significant market dip – and the scary financial news flashes and dire predictions that come with it – might make us want to guard our money instead of risking it in the markets. We might consider moving it all into low-risk investments like bonds or certificates of deposit or high-yield savings accounts.

But for most of us, such a move would be a costly mistake that could set our retirement plans back years.

No matter the short-term fluctuations of the stock market, these tips will help you keep your sanity … and your solvency:

1. Don’t look at your accounts right now. Unless absolutely necessary, resist taking a peek at your investment accounts. This will help prevent your primitive brain, prone to all those behavioral biases, from panicking and doing something rash.

[RELATED: How to Recession-Proof Your Finances]

2. Put things in perspective. If you don’t need to withdraw from your investments for decades, then a drop in the market can be viewed as something of a fire sale – one that, in the long run, will help you grow your portfolio. This assumes you are continuing to practice dollar cost averaging, an investment strategy where you are making regular investments in the market. It also assumes that you are staying the course, keeping your money in the market for the long haul.

If you’re closer to retiring from the workforce, say 15-20 years out, you still have plenty of time to recover from market fluctuations as long as your portfolio is allocated properly. If you don’t know how to allocate your portfolio, you could consider investing in a target date fund (like the Thrift Savings Plan’s Lifecycle funds).

[MOAA RESOURCES: Asset Allocation Calculator]

If you are five or less years away from retirement, hopefully you have already moved some of your portfolio into less-risky investments such as bonds and cash.

Those in retirement and withdrawing from their investments should have a sizeable cash reserve and a portfolio structured to weather a prolonged market downturn.

3. Get help if you need it. If the words “asset allocation” sound intimidating and the idea of a hands-on approach to investing makes you nervous, you might want to call in a professional.

I am a big proponent of getting a periodic reality check from a fee-only financial planner. Yes, this costs a bit, but retirement withdrawal planning is complicated. You don’t want to get this wrong.

If you are experiencing financial difficulties and need help with debt management or are going through a life transition and want guidance on creating a spending plan, you can get free financial counseling through the Veterans Benefits Banking Program. Active duty servicemembers and retirees also can access financial counselors at their nearest family readiness center.

This article was originally published in 2022. Last update: August 2024.