When is it a good time to sell or change my investments?

1.  Your investments mature. If you have money invested for a set period of time, watch the maturity date. That’s when you’ll have cash to reinvest. Plan ahead for your next step. Talk to your adviser if you need to.

2.  Your goals or plans change. Sometimes you may have made all the money you hope for from an investment. You are ready to try something new. So, you sell the investment and move on.

You may also change investments when your situation changes. Say you get married, buy a house, or get a new job. A new investment may be a better fit with your new situation, goals, and plans.

When is it NOT a good time to sell or change my investments?

1. Your investment drops in value. Sometimes there may be a good reason to sell an investment that has dropped. But more often, if you have chosen a good investment for the long term, the value should climb back up over time. Try not to overreact to short-term changes in their value.

Tip: If you buy and sell a lot because you react too much to small price changes, your investment costs will rise. This lowers your investment return.

2. The stock market suddenly drops. Avoid panic selling if the market suddenly drops. Talk to your adviser. You don’t want to find that you sold an investment at the wrong time and wish you had held on until the market recovered.

Remember the crash of October 1987? Prices of stocks dropped sharply, but eventually bounced back. A lot of people lost money because they panicked, sold their investments, and took a loss. Three or four years later, most of those who held onto their investments ended up well ahead of where they were before the crash.

Remember: A loss isn’t a loss until you sell.

Many investments do recover after their value falls. The key question is how long it may take, and what you could do if you took the loss and reinvested your money in something else. You may want some advice to help you make those kinds of decisions.