When times get tough, invest like Buffett.

For one, don’t panic when markets become a volatile mess.

Remember, markets are resilient.  We’ve come back from far worse. If you panic, you sell. And if you sell, you miss the potential for the recovery rally. We have to remember that markets are resilient and eventually recover, as they have historically.  In fact, look back at the history of bad moves and you’ll see that each time they were followed by a recovery rally.

Also, as Buffett said at a 2016 shareholder meeting, “During such scary periods, you should never forget two things: First, widespread fear is your friend as an investor, because it serves up bargain purchases. Second, personal fear is your enemy. It will also be unwarranted,” as quoted by MarketWatch.

Two, don’t wait too long to invest.

As Warren Buffett has also said, “I haven’t the faintest idea as to whether stocks will be higher or lower a month or a year from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So, if you wait for the robins, spring will be over.”

Plus, as he has famously said, “Be fearful when others are greedy, and be greedy when others are fearful.”  Sure, there’s plenty of fear out there. But fear won’t last forever.  Even the biggest companies in the world will have hiccups, but in 10, 20 years from now, should be just fine.

Three, get paid to wait for a recovery.

Companies with strong cash flows and attractive yields tend to outperform even the worst of markets. According to The Wall Street Journal: 

“Dividend stocks have become the new darling on Wall Street, and investors looking for income are pouring billions of dollars into them.  These securities are considered a good buffer during times of market volatility. They also are seen as an inflation hedge, considering that S&P 500 dividend growth has outpaced inflation since 2000.”

Four, buy safe havens, like gold and gold stocks, for example.

Not just because of the geopolitical crisis in the Middle East, but because of slowing economic conditions here in the U.S.  According to The Conference Board, “This outlook is associated with numerous factors, including, elevated inflation, high interest rates, dissipating pandemic savings, rising consumer debt, lower government spending, and the resumption of mandatory student loan repayments.”