Welcome to reThinkable - my Sunday newsletter where I share actionable money tips, strategies, and resources to help you make smarter money moves.

Read time: 4.0 minutes

Hey friend,

The past couple of weeks were pretty weird…

• The stock market dipped… and then it recovered

• The US economy shrank 0.3% in the first 3 months

• But then the April jobs market was stronger-than-expected

Talk about a looooong couple of weeks/months/years….

Many of you have reached out to me for advice. Some of you asked about how to take advantage of this market volatility, others are in full panic mode.

And I 100% get it. I’d be lying if I said I hadn’t felt a bit anxious the past few weeks.

How could you not feel it when the media is panicking, your friends and family are sending you “URGENT” news articles, and your social media feed is filled with people talking about economic collapse.

In today’s newsletter, I wanted to talk about the volatile stock market—just to put things into perspective so you can (hopefully) enjoy the rest of your day.

What does investing, history and philosophy have in common?

I stumbled on this quote this week and it hit the nail on the head:

Let’s break this quote down.

Philosophy teaches us how to think clearly—especially when things feel messy. It’s about making logical decisions instead of emotional ones.

Markets crash not because the numbers suddenly stop making sense, but because something spooks investors. It’s like when 1 kid at a sleepover gets homesick, and then suddenly everyone wants to go home. Panic spreads fast.

And just as easily, a ray of hope — like a new jobs report data — can make investors confident again.

Now onto the history part

This isn’t the first time the market has crashed.

Here are the last 3 major crashes—how far the market fell at its lowest point, and how much it recovered over the next 5 years.

S&P 500 - exact %’s may vary based on dates filtered

The market has a way of bouncing back, to a point where it's even better off than before the crash. It might take some time to see consistent highs after a crash, but the calm eventually comes.

Don’t just take my word for it: Google S&P 500 and click on the "Max" time range in the chart.

You’ll see it for yourself—despite the dips and crashes, the stock market climbs over time, and so does the money of logical and patient investors

What should you do?

This isn’t me saying things won’t get tough.

It’s normal to be worried. 

But don’t make any rash decisions. That’s the one move that will bite you in the end.

History (and a little bit of philosophy) remind us: this too shall pass.

Here’s what you need to do to get through it:

1. Keep your investment strategy the same

A major market crash splits investors into 2 groups: Reactive Investors and Freedom Investors.

Reactive Investors let fear take over. They obsess over every headline, check their portfolio 10 times a day, and focus on how much they’ve “lost.” Eventually, they panic sell and lock in those losses for good.

Freedom Investors know that markets recover. They stay calm, stick to their plan, and ride out the storm. They understand that temporary dips are part of the journey.

Fast forward 5 years: Freedom Investors are enjoying massive returns and Reactive Investors are still regretting their decision.

If you remember just 1 thing today, let it be this:

The market is unpredictable—but staying invested is how you win in the long run.

2. Start investing (if you haven’t yet)

The best time to start investing is always NOW, especially when the market is all over the place.

When the market is low, think of it as a SALE at your favorite store. It’s your opportunity to snag some stocks for 40% off.

You don’t need to perfectly time the bottom (it’s actually impossible), but take advantage of the opportunity to build wealth while everything’s on sale.

3. Add to your emergency fund

I don’t want to sugarcoat it: Market downturns can impact your livelihood.

As panic spreads, layoffs become more common and the cost of everyday essentials goes up.

If you’re used to keeping 6 months of expenses in your emergency fund, bump it to 7.

And whatever you do, keep that money in a High Yield Savings Account. It’s the easiest way to protect your savings from inflation. Here are some of my favorite ones.

4. Cut back on the extras

Right now, your priority should be using any extra cash to either invest or build up your emergency fund.

Investing now is a great way to take advantage of volatile stock market.

Padding your emergency fund can make sure you’re covered no matter what.

No need to live off saltines and tuna to save money. But maybe hold off on that $4,000 living room remodel.

What you SHOULDN’T do

1. Panic sell. (Seriously. Don’t.)

The market’s best days usually come right after the worst days.

In the past 20 years, 7 of the 10 best days in the stock market happened within just 2 weeks of the 10 worst days.

If you bail during a crash, you’ll miss the rebound.

2. Check your portfolio every day

Most Financial advisors agree that checking your portfolio every day is a bad idea. Right now, you’ll only stress yourself out and make decisions you’ll regret. 

3. Get sucked into the doom

Limit your news to 30 minutes a day from trusted sources. That's enough. It’s important to take care of your mental health in these wild times.

Remember, we’ve been through this before, and we’ll get through it again.

To making smarter money moves,

— Vincent Chan

Cool things I found this week

• Here’s how to get an Apple AirTag and keychain for $1.11. No gimmicks. No hidden fees. You have until May 12.

• Get up to 40% off products sold and shipped by Amazon when you use at least 1 Amex Membership Rewards point. Click here to see what you’re eligible for.

• Do you shop at Shein or Temu? Prices are going UP UP UP. Here’s why.

Vincent Chan

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