When there is a bear market (a market where stock prices are falling) it can be difficult to continue to invest. You may be worried about buying stocks and taking the chance that the prices will continue to fall, and you would then lose that additional money. Investing in the stock market should be a long-term investment. If it is then you can look at the lower stock prices as the opportunity to buy them when they are on sale.
The market will recover over the next five to ten years. If you have that long before you need the money you have invested, then you are likely to profit considerably by investing in the stock market now. It is important that you continue to follow good investing practices. The safest type of investment are mutual funds or index funds. These spread the risk over several different stocks. This protects you if one of the companies were to fold unexpectedly.
Investing in individual stocks in a bear market can be especially risky. If you have a company that folds or is taken over in a hostile takeover you may end up with nothing. If you currently have large investments in single stocks you may want to begin transferring them over to mutual funds a bit at a time. It is scary to hold onto large amounts of individual stocks, but you may suffer large losses if you sell when the market is at its lowest. Sell some now, and wait to see if the market improves. This may stop you from taking a hit when the market is at its lowest.
If you are unsure of what to do you should talk to a financial planner. She should be able to explain the risks that each investment holds. As you grow closer to retirement you may need to change your investing strategy and move your money into funds with a much lower risk, but in your twenties you have time to ride out the low points in the market. A financial planner can help you with investments outside of your retirement plan, but he may also be able to help you understand the mix of retirement investments inside of your plan, so that you can balance it to match your comfort level for risk.
It is important to remember that investing for retirement is a long-term process. Following basic retirement savings rules can make it easier to save. You should not panic if your portfolio goes down while you are in your twenties. AS you get older you should move to more financially conservative investments, but for now take advantage of the chance you will have to recover and invest aggressively in your mutual funds. It is important to consistently save and invest no matter what the current market conditions are. You can make a real difference in how comfortable your retirement is, if you plan carefully now.