When the stock market takes a hit, it’s easy to feel anxious. You check your investments and suddenly, everything looks like it’s going downhill. For many Canadians, this can be a stressful experience. But wealth advisor Kamal Lidder says it doesn’t have to be.
A market crash isn't the end—it's a moment to pause, think clearly, and make smart decisions. Whether you're new to investing or have years of experience, here's what Kamal suggests when markets take a turn for the worse.
Keep Calm and Don’t Make Sudden Moves
The first thing Kamal Lidder advises is not to panic. Markets go up and down—it’s part of the cycle. Big drops can happen quickly, but over time, markets have always recovered.
Why Do Markets Crash?
Some of the reasons include:
Rising interest rates from the Bank of Canada
Global events like wars or pandemics
Drops in key sectors like oil or real estate
Panic selling and emotional decision-making
Knowing the cause of the crash can help you see the bigger picture instead of reacting out of fear.
Stick to Your Long-Term Goals
If you’ve made a solid investment plan, now is the time to trust it. Kamal reminds investors that long-term goals shouldn’t change just because the market is having a rough patch.
Think about why you started investing. Was it for retirement? A new home? Your children’s education? Those goals are still valid.
Here’s what you can do:
Review your investment mix
Make sure your risk level still fits your needs
Avoid checking your portfolio every day—it adds stress
Rebalance If Needed—But Don’t Sell Everything
During a crash, your portfolio might shift. Some investments may fall more than others. Kamal recommends checking your asset mix and rebalancing if needed.
That doesn’t mean pulling everything out of the market. A downturn can be a great time to buy quality stocks at a lower price.
Quick tip: If you’re investing through RRSPs or TFSAs, this could be an ideal time to top them up while prices are low.
Always Have an Emergency Fund
Kamal strongly advises all Canadians to keep an emergency fund. Having 3–6 months of living expenses set aside can prevent you from selling your investments at a bad time.
Even if it takes a while to build, a cash buffer makes it easier to ride out tough periods without touching your long-term savings.
Don’t Follow the Crowd—Stay Informed
It’s tempting to follow what others are doing, especially during a market crash. But Kamal Lidder says it’s important to stay grounded and not get swept up in the panic.
Instead:
Read from trusted Canadian financial sources
Focus on your plan
Speak with a licensed financial advisor if you’re unsure
Making decisions based on facts, not fear, can save you from costly mistakes.
Downturns Can Create New Opportunities
It might sound strange, but a market crash can also be a chance to find value. Stocks you couldn’t afford a few months ago might now be within reach.
Look for:
Strong Canadian companies with good fundamentals
Sectors that have long-term growth potential
Dividend stocks that continue paying during downturns
Kamal suggests keeping a list of companies you believe in—and buying a little at a time if it fits your strategy.
Final Thoughts: Stay Steady and Think Ahead
Market crashes can be stressful, but they don’t have to derail your financial goals. With a calm mindset and a smart plan, you can make it through and come out stronger.
Kamal Lidder’s message to Canadians is simple: don’t rush, don’t panic, and don’t lose sight of why you started investing in the first place.
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