We’re all becoming a little used to watching our investments tick downwards. It’s disheartening at best, but you can take a few steps to protect yourself. You can’t change the value of your investments, but you can reassure yourself that you’ve done everything you can to protect yourself from a problematic market. The three steps below can help ease your mind — at least a little — about what’s happening with most investments.

1. Know Your Rights: Depending on where your savings account is, there might some changes going on beyond the name on the building. However, making sure you’re aware of just what the bank is allowed to do with your money — and what rights you have — can help ensure that a sudden change won’t put your cash accounts in danger. You should also understand the protection the FDIC offers you for savings accounts, CDs and other cash accounts. If you’re not quite sure what the FDIC does, you can read up on it on the FDIC website: I’d recommend reading the bank closing information for Silver State Bank or another failed bank, rather than the various ‘About the FDIC’ pages. You’ll get an example of exactly what happens, rather than wading through hypotheticals. The FDIC actually protects more than you might think, including IRAs and money market accounts.
2. Minimize Movement: Unless you are truly not confident in an investment’s ability to ride out the recession intact, try to minimize moving your money around. That’s actually a fast way to lose money — with all the fees that can be associated with a move, you can wind up losing far more than you might expect. For most investments, the current downward trend is nowhere near permanent. Once the economy becomes stronger, stocks and other investments will regain value. It’s a waiting game. There are a few exceptions, of course. If you do need your money now, it’s reasonable to pull it out of an investment, although it’s worth discussing the matter with a financial planner in order to protect your investment as much as possible.
3. Save and Diversify: While it can be harder to sock away money during a recession, creating a bigger cushion of savings can reduce your worries about the current financial situation. It may seem counterintuitive to invest any of your savings during a recession, but it’s worthwhile to do so as long as you invest conservatively. CDs and other insured investment vehicles can keep your money safe while the market evens out. Do your research before investing anything, of course, and diversify where you place your savings to increase their safety as much as possible.

There is no perfect way to protect your investments, unfortunately. Even putting all of your money in a mattress at home is risky — and that money is certainly uninsured. However, you can ease your mind by taking the steps available to you: if you’ve done everything you can to protect your investments, you can rest a little easier when it comes to money matters.

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