Experts say it's time to prepare for the "Bear" market

Wall Street's record Bull run "can't last forever"
Posted at 1:24 PM, Aug 27, 2018
and last updated 2018-08-27 16:24:08-04

SAN DIEGO (KGTV): Wall Street set a record last week for the longest "Bull" run in US Stock Market history, topping 3,400 days of growth. Now, financial experts are saying it won't last forever and advising clients to prepare for a downturn.

"You have to expect at some point, we're due," says Dennis Brewster of SagePoint Financial. "I think everybody's almost forgotten, look at earlier in the year, how sharp the markets broke back in February. So it wouldn't be unusual to see any of those declines coming up later this year or early next year."

Brewster says he doesn't expect anything as drastic as 2008, but he still says investors should take a few steps to safeguard their earnings and even make the downturn work in your favor.

A lot of it, he says, depends on how close you are to retirement.

"When you look at the year to year returns, they're all over the board. When you look at the 20-30 year returns they're very close," says Brewster. "If you're younger and have 20-30 year horizons, the day to day gyrations are almost noise to you. But if you're getting closer to retirement or in retirement, then you have to be more careful."'

Brewster looked up numbers from the S&P 500 for the last 20 years. He says someone who invested $10,000 in 1998 would have lost about $1,300 after the crash in 2008. But if they kept their money in until 2018, that same $10,000 investment would now be worth more than $33,000.

He says older investors should be more conservative with their portfolios. Younger investors should increase how much they invest if the market falls, to take advantage of lower prices.

As for when the correction could come, Brewster says it's too tough to predict. But he says to watch out for "triggering" events that could rattle the market, some of which may already be happening. Things like trade wars or the Federal Reserve spiking interest rates could be the kind of thing to end the Bull Run.

"It always goes higher than you think and lower than you think," he says. "You can't ignore it, and you try not to get swallowed by it."