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Financial advisor: 'We've seen this before'

As we're seeing a decline in the current stock market, investors are nervous. Newswatch 16's Chelsea Strub talked to an expert for some advice.

KINGSTON, Pa. — For many, the stock market, with all the letters, numbers, and charts, may be difficult to navigate. But one thing most can agree on is that red means bad.

"That really means panic selling when everything is being sold, and it's all red," explained Peter Shelp, a financial advisor with Janney Montgomery Scott in Kingston.

Shelp says panic selling is due to fears of a recession, which is possible but might not happen.

"But that's the fear," he explained. "So, interest rates rising, inflation, and a possible recession are leading to the next part, which is what you'll hear now is a bear market. That is when a market falls 20 percent or more might be happening right now. That's the bad part."

We asked Shelp what his advice was for somebody that might have retired a little bit early because of the pandemic, and now they might be losing some of their retirement in the current market.

"That's happening. That's a good question, and so the bid goes back to the original discipline of what they're investing, how we're not changing that much. So it's a good idea to rebalance the investment, the allocation of stocks versus bonds, for example."

Even though the market for stocks, bonds, and cryptocurrency is down, Shelp advises against selling. He suggests waiting it out, saying that what we're seeing now is familiar.

"In the rearview mirror, we've just seen this. And in 2020, we had an economy almost completely stopped. And that would be cause for investors to sell their stocks or companies. And they did, but, in the end, the economy got back on track for the most part," he explained.

Shelp says that wait-out period could be close to a year, but he believes people who refrained from selling back in 2020 made out better than those who did.

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