Market crashes are usually accompanied by nervous headlines, flashing red tickers, and a palpable sense of impending doom. For most, a recession feels like a disaster. But at 25, this is actually a golden opportunity to lock in your long-term holdings at a huge discount. In this article, we’ll look at why recessions can actually be a powerful benefit for youth, long term investors.
Why do market crashes feel so painful?
Because of loss aversion, the “pain” you feel when your portfolio drops from S$10,000 to S$7,000 often seems more intense than the “pleasure” of seeing it rise to S$13,000. And the media always loves to rub salt into the wound by focusing on short-term chaos and sensationalist headlines like ‘trillions in market value disappear overnight’. As a result, many people start thinking short term and sell exactly when they should. Buying.
The benefits of being 25: Time is your greatest asset
At 25, your greatest asset is you investment horizon….
