Questions to ask an advisor when markets get volatile
Your concerns may differ depending on where you are in your life. These tips can help you focus on the risks and potential opportunities to explore at each life stage.
NO MATTER HOW DILIGENT YOU ARE about investing and planning, when the market swings wildly, it’s normal to feel nervous or anxious. This is why it’s important to keep in mind that whether you’re just starting out, getting ready for retirement or already retired, stock market volatility is a normal part of investing. Since 1980, the S&P 500 has seen average drops of 14% within the year but still ended the year with positive returns three-quarters of the time, with an average return of 11%.1
“Difficult markets often lead to emotional decisions that might not be in your financial best interest. That’s human nature.”
— Marci McGregor, head of CIO Portfolio Strategy, Chief Investment Office, Merrill and Bank of America Private Bank
When markets get unpredictable, even the most seasoned investors might find themselves doubting that basic investing tenet. “Difficult markets often lead to emotional decisions that might not be in your financial best interest,” says Marci McGregor, head of CIO Portfolio Strategy in the Chief Investment Office for Merrill and Bank of America Private Bank. “That’s human nature.”
A financial advisor can help you keep perspective, avoid rash decisions and suggest some steps you might take to rebalance and preserve your accounts. They might even be able to suggest potential investment opportunities you could consider making while the markets are down. Below are a few questions for whenever the markets dip, plus some insights on how you could benefit from working with an advisor, wherever you are in your investing journey.
How should I handle market drops? If a steep or sudden market decline makes you uneasy, call your advisor. They can help you assess your current situation and reset your short- or long-term goals and discuss whether you need to make any adjustments to stay on track. Your advisor can also walk you through your options, as well as the fees and expenses involved, taking into consideration current market conditions and how much time you have to pursue those goals — things like saving for your children’s college, purchasing a home or covering caregiving costs for your parents. With the help of your advisor, consider whether you need to rebalance your investments. If volatility causes you to realize that you’re not as comfortable with risk as you thought you were, your advisor can help adjust your strategy.
Good to know: After drops of 20% or more, the market has returned 107% on average over the following five years.1
Can I turn volatility into an opportunity? Staying invested even during market shocks gives you an opportunity to participate in the potential market upside. That’s because pulling out when the markets are down may put you at risk of missing a recovery, notes McGregor. In addition to providing the important historical perspective that may help you ride out market swings, your advisor can suggest new investment ideas based on the latest market research that might fit with your time horizon and risk tolerance.
Should I change my investments? If you’re close to retirement, you may be tempted to get out of stocks altogether. “But a too-conservative portfolio can be risky, too,” says McGregor. An advisor can show you how adjusting your asset allocation could potentially affect your portfolio’s return over time — an important consideration as you plan for upcoming major expenses, such as the rising cost of healthcare. “In some cases, as you approach retirement, you may even want to increase risk slightly on a calculated basis,” says Chris Hyzy, Chief Investment Officer for Merrill and Bank of America Private Bank.
Good to know: Dividend growth has historically outpaced rising prices, giving investors more buying power in inflationary times.2
What can I do to stay flexible? Depending on the extent of the volatility and its impact on your portfolio, you may have to consider working a little longer or putting off another goal, notes Ben Storey, director, Retirement Research & Insights at Bank of America. “An advisor can help you find other ways to adjust. You might talk about putting off the purchase of a second home, for instance, so that you can still retire when you want to.”
Do I have enough cash on hand? Plummeting markets can be especially nerve-wracking if you’re relying on funds from your retirement accounts to cover living expenses. “Your advisor can help you revisit your budget to see which nonessentials you can trim to free up income,” Storey says. If you do need more cash for a large expense or to pay down high-interest debt, your advisor might suggest working with a bank to consider low-cost borrowing options so you don’t have to withdraw assets in a down market.
Good to know: Cash is a distinct asset class where both safety3 and liquidity are prioritized over return.
How can I help preserve my retirement? In addition to working with you to evaluate and possibly adjust your asset allocation to help minimize losses and maintain a potential income stream, your advisor can suggest strategies for making your money last throughout what could be a long retirement and prepare for late-in-life expenses like long-term care.
Preparing for the next downturn
As concerned as you might be about your finances when volatility starts, you can feel more assured by working with an advisor who can help you prepare your portfolio to weather downturns when they hit. An advisor can help you make informed decisions by guiding you in establishing, reviewing and adjusting your investments to match your changing needs and life circumstances.
A Private Wealth Advisor can help you get started.
1 Chief Investment Office, “Steer the Course of Your Financial Future: A Guide for Long-term Investors,” August 2025, Exhibit 2B, S&P 500 Cumulative Price Return (%) (From Trough During Greater than 20% Drawdowns) five-year average excludes 2022 periods. Source: Bloomberg. Data from January 1, 1962 to July 31, 2025.
2 Dow Jones Indices, “S&P High Yield Dividend Aristocrats: A Historical Perspective on Dividend Stability and Growth,” December 2024. Period covered is from November 2005 to November 2025. S&P High Yield Dividend Aristocrats (S&P HYDA) is a prominent dividend growth index, with nearly 20 years of live history. The index tracks stocks in the S&P Composite 1500® that have consistently increased their total dividends per share every year for at least 20 consecutive years. The index universe covers large-, mid- and small-cap stocks in the U.S. equities market. This paper focuses on the S&P HYDA, examining its characteristics, risk/return profile and performance attribution.
3 CIO Educational Series: Optimizing Cash Use for Investors. Ultimately, it’s important for investors to remember that no investment is guaranteed to be “safe.”
Important Disclosures
Opinions are as of 01/15/2026 and are subject to change.
Bank of America, Merrill and their affiliates do not provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.
Investing involves risk including possible loss of principal. Past performance is no guarantee of future results.
Asset allocation, diversification and rebalancing do not ensure a profit or protect against loss in declining markets.
This information should not be construed as investment advice and is subject to change. It is provided for informational purposes only and is not intended to be either a specific offer by Bank of America, Merrill or any affiliate to sell or provide, or a specific invitation for a consumer to apply for, any particular retail financial product or service that may be available.
The Chief Investment Office (CIO) provides thought leadership on wealth management, investment strategy and global markets; portfolio management solutions; due diligence; and solutions oversight and data analytics. CIO viewpoints are developed for Bank of America Private Bank, a division of Bank of America, N.A., (“Bank of America”) and Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S” or “Merrill”), a registered broker-dealer, registered investment adviser and a wholly owned subsidiary of Bank of America Corporation (“BofA Corp.”).
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Investments have varying degrees of risk. Some of the risks involved with equity securities include the possibility that the value of the stocks may fluctuate in response to events specific to the companies or markets, as well as economic, political or social events in the U.S. or abroad. Bonds are subject to interest rate, inflation and credit risks. Investing in fixed-income securities may involve certain risks, including the credit quality of individual issuers, possible prepayments, market or economic developments and yields and share price fluctuations due to changes in interest rates. When interest rates go up, bond prices typically drop, and vice versa.
