How should investors handle their 401(k) or IRA during market volatility?

Financial markets have experienced historic volatility in recent days amid elevated uncertainty due to President Donald Trump’s trade war with China and other countries, and experts say that investors should stick with their long-term plans and resist the urge to make snap decisions.

The Dow Jones Industrial Average experienced back-to-back swings of more than 2,000 points in consecutive trading sessions on Monday and Tuesday, with Monday’s session setting a record for the largest intraday point swing.

With investors watching their 401(k), IRA or other brokerage accounts fluctuate wildly, experts suggest that they shouldn’t panic and sell stocks or deviate from a long-term investing plan, and instead should continue with that plan because if the plan is well-diversified, the volatility will be beneficial over the long run.

“If investors have a good plan in place, then they should stick to the plan,” David Bahnsen, founder and managing partner of the Bahnsen Group, told FOX Business in an interview. “For example, if they have a stock market in their 401(k) or their retirement accounts, then that weighting in the stock market is supposed to take into account the fact that markets sometimes go down a lot.”

GOLDMAN SACHS INCREASES RECESSION PROBABILITY, WARNS OF FURTHER DOWNGRADE IF MORE TARIFFS TAKE EFFECT

Experts say investors should stick to their long-term plan rather than deviating in response to market volatility. (Michael M. Santiago/Getty Images / Getty Images)

“They don’t do it a lot this quickly, this violently, but they do it,” he added. “It happened after COVID, it happened after the financial crisis, it happened after 9/11. Every five to seven years you have one of these experiences, and they’re really brutal for people, but they’re part of why investors get a better return over time from being in the stock market.”

Bahnsen explained that by reacting to turmoil in the market and making decisions based on volatility-induced panic, they risk reducing their long-term gains.

“What investors do to undermine their own return is panic out in these times, and what I think investors need to do is really remember that we don’t know if this trade war is done in two hours, two weeks, or two months — what we do know is it will be over,” Bahnsen explained. “This market violence may already be near the end, it may have a lot further to go, but it will be over.”

GEN Z OUTPACES OLDER GENERATIONS WITH EARLIER JUMP INTO INVESTING: REPORT

Markets have experienced historic volatility amid President Donald Trump’s trade war. (Spencer Platt/Getty Images / Getty Images)

Bahnsen added that investors who are contributing to their 401(k) accounts or are reinvesting dividends during volatile downturns are improving their portfolio over the long-term by buying stocks at relatively low prices.

“It’s one of the big…