What should I do when the market drops?
Usually nothing. If you have a regular contribution, keep it going; you are buying cheaper. Check that your emergency fund is intact, avoid selling, and remember that every previous drop recovered.
Nothing is the correct answer surprisingly often. If you own a diversified fund and do not need the money for years, a 15 percent drop changes nothing about your plan. The market has fallen that much dozens of times and recovered every time. Selling converts a temporary decline into a permanent loss, and the people who sold in 2008 or March 2020 mostly did not get back in before the recovery.
If you invest monthly, the drop is working in your favour. The same contribution buys more shares at lower prices. Some investors add a little extra during big declines, which has paid off historically, but even just continuing is enough.
The exception is money you were wrong to have in stocks in the first place: next year’s tuition, a house deposit. If a drop reveals that, the lesson is about time horizon, and moving that money to savings, even at a loss, may be right. Better to learn it on a 15 percent drop than a 40 percent one.
What helps in the moment: read a plain explanation of why the market fell, so the move has a cause rather than being a formless threat, and then close the app. A drop with a reason is much easier to sit through than a drop that feels like the end of something.
Informational only, not financial advice. Updated September 4, 2026.
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