The stock market has been charging toward all-time highs, but that’s not making every investor feel good. Some people worry too much about the future and sell their positions to lock in gains instead of staying committed to their investments.
Voters who were disappointed with the outcome of the election may feel more uncertainty and doubt that the economy can maintain its good footing under a Donald Trump presidency.
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However, Suze Orman believes that Trump’s election victory isn’t a sufficient reason to exit the stock market, even for people who loathe him.
Orman highlights the promising opportunities in the present stock market, internal obstacles to avoid and a long-term perspective that can help you navigate volatile markets.
How To Beat the Three Big Internal Obstacles That Block People from Wealth
In a recent podcast episode entitled “Stay the Course and Make Money,” she pinpoints fear, shame and anger as three big obstacles that prevent people from committing to long-term investments.
Orman encouraged her listeners to live in the present instead of worrying about the future. Investors can deal with the future little by little as it happens instead of basing all of their decisions around events that may or may not occur.
She also recommended asking yourself what actions you are taking to achieve financial independence. Focusing on small steps and letting them compound can lead to steady progress, and as you make more progress, you’ll knock down internal obstacles.
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The Fed Lowered Interest Rates
Shortly after Trump’s victory, the Federal Reserve announced the second interest rate cut of 2024.
The meeting was scheduled before the election outcome, and many investors anticipated a rate cut since the Fed announced its previous rate cut back in September. The Fed cited cooling inflation as justification to trim the rate by 0.25 basis points.
Stocks took off on the news before contracting a bit. It’s normal for stocks to have a down day after strong rallies as investors decide if they want to take some of their gains off the table and reassess valuations.
Lower interest rates will prompt more businesses to borrow money, and it will also make consumers feel more empowered. Lower rates should lead to higher consumer spending, and if inflation remains in check, stocks can continue their meaningful rally during the Trump presidency.
There Have Never Been So Many Opportunities To Create Serious Wealth
Even with the stock market’s massive rally, Orman still believes investors haven’t missed the boat. It’s normal for investors to feel this way shortly after the stock market or individual stocks enjoy substantial gains.
It’s easy to think about what could have been if you bought shares in a hot stock five years ago. However, today’s stock market is filled with tremendous opportunities that can lead to captivating returns, according to Orman.
She cites artificial intelligence as a promising industry, and it’s easy to see why. According to Grand View Research, the AI industry is projected to maintain a 36.6% compounded annual growth rate from now until 2030. The industry features tech giants like Nvidia and Broadcom, which have delivered enticing long-term returns for their investors.
Investors can choose from thousands of publicly-traded companies. Some of them are reporting healthy revenue growth while growing their profit margins.
Even if you don’t want to analyze individual stocks and decide on the best ones for your portfolio, you can just buy an index fund or an ETF. Those funds make it easier for anyone to get started.
Patient Investors Recover from Corrections and Crashes
The stock market isn’t an endless bull run. Long-term investors have navigated their fair share of corrections and crashes. However, with stocks at all-time highs, it’s evident that equities recover from setbacks.
Keeping this perspective in mind can help you stick with your investments when the market dips. Orman tells her listeners to stay grounded and focused, regardless of short-term noise.
Money can always come and go, but staying disciplined on your path to wealth can help you achieve your financial goals in the future.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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This article originally appeared on GOBankingRates.com: Here’s Why Suze Orman Says This Is Not the Time To Be Selling Out of the Stock Market
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
