What the Coronavirus Could Do to Your Money

by Meredith Morris

Financial Frequency. myRetirement

February 26, 2020 .2 min read

With the outbreak of the coronavirus growing, health officials are warning Americans to prepare for the possibility of it spreading throughout the US. Not only is there fear of this becoming a pandemic, but also how it will affect the market.

The outbreak of the virus has put a halt on China’s global supply chains, the world's second-largest economy seems to be coming to a halt. There is fear about what the short term and long term effects will be on the world’s economy.

While President Trump has downplayed the virus and its effects, worried investors have been dumping stock in fear of the spread of the virus. Monday, February 24 was the worst day for the American market since 2018, and it has continued to fall.  

Concerns have been rising for some time among economists and investors about how this virus will threaten the market, it seems to be finally catching up. 

With the questions of the coronavirus now being not if it will spread in the US but when, the sell-off by investors has spiked.

The New York Times reported that The S&P 500 was down about 7.6 percent from its recent record high at the end of Tuesday’s trading day, raising expectations that the Federal Reserve may lower interest rates. 

It’s still unclear how big the effects of the coronavirus will be on the market, but with the sharp decline in bond yields in the past few days, there is growing uncertainty. We are likely to hear more about this from the Federal Reserve in the next few days.

With the fear of the virus growing the US is also considering some travel restrictions to help with the spread but no decision has been made. 

Only time will tell how much this will affect the market, but it’s important to stay on top of what is going on, both with your investments and with major health updates from the Center for Disease Control. 

That being said, don't panic and sell all your investments. Think about retirement as a long term strategy. While this may be affecting the market now, that doesn't necessarily mean it will affect your money in the long term. If you are concerned, reach out to your financial professional and stay on top of what is happening in the news.