What a bad month teaches you

On March 12, 2020, I watched the S&P 500 drop 9.5% in a single day. I had friends texting me nonstop. “Should I sell?” “I can’t watch this anymore.” “I’ll get back in when things settle down.”

A few of them did sell. Every single one of them regretted it.

What it actually felt like

I remember looking at my portfolio and doing the math on what the decline meant in dollar terms. That was a mistake. Percentages are abstract. Dollar amounts are personal. Seeing the actual number I’d “lost” hit differently than seeing a red percentage. It felt like someone had reached into my account and taken money out.

I didn’t sell. But I want to be honest: I thought about it. Not because I believed it was the right move, but because the discomfort was overwhelming. The urge to do something, anything, was physical. That’s what a bad month actually feels like. It’s not an intellectual exercise. It’s a full-body experience.

The worst part wasn’t the numbers. It was the loneliness of the decision. Everyone around me was doing something. Selling, hedging, moving to cash. Doing nothing felt reckless, even though it was the opposite. Sitting still while everyone else acts takes a kind of stubbornness that doesn’t feel like a virtue in the moment. It just feels like you’re ignoring a fire alarm.

Holding your investments while everyone around you is selling takes a kind of stubbornness that doesn’t feel like a virtue in the moment.

”I’ll get back in when things settle down”

This is the sentence I heard more than any other in March 2020. Friends, family, people at coffee shops talking about their investments. “I’m going to cash, just until things settle down.”

It sounds so reasonable. That’s what makes it dangerous. It feels like the responsible, cautious thing to do. You’re not giving up on investing. You’re just stepping aside for a moment. Taking a breather.

But “when things settle down” is a feeling, not a signal. And feelings during a crash are the least reliable guide you have. You’re waiting for something to feel safe. But it never does. Not when the recovery starts. Not when the market climbs 10% off the bottom. The headlines are still scary. The economy still looks broken. Nothing feels settled, so you keep waiting.

One friend sold everything in late March 2020. He told me he felt instant relief. The number stopped going down. He was “safe.” That relief lasted about three weeks, until he realized the market was climbing back without him. He didn’t buy back in until November. By then, the damage was done. He locked in his losses, missed the recovery, and ended the year behind where he would have been if he’d done literally nothing.

The cruelest part? Selling felt like a decision. Holding felt like inaction. But holding was the decision. Selling was the panic. I have other friends who weren’t even invested, waiting for a crash to get in. They didn’t buy either. The fear that makes you sell is the same fear that keeps you from buying back.

The anatomy of a panic sell

Here’s what I’ve noticed watching people sell in a panic, across multiple downturns. It always follows the same pattern.

First, they watch the decline for a few days and tell themselves they’re fine. “I’m a long-term investor. I can handle this.” Then the decline accelerates. The self-talk shifts to, “This could get a lot worse.” They start checking their portfolio multiple times a day. Every check makes them feel worse.

Then there’s a trigger. It might be a single bad day, or a scary headline, or a conversation with someone who already sold. Something tips them from “I’m uncomfortable but holding” to “I need to stop the bleeding right now.”

They sell. Immediately, they feel relief. The number has stopped going down. They’re “safe.” That relief is real, and it’s powerful. It’s also the most expensive emotion in investing.

The relief never lasts. Within days, sometimes hours, it gets replaced by a new anxiety: “When do I get back in?” And that question has no good answer. The same fear that made them sell is now the thing preventing them from buying back. They’ve traded one source of stress for another, except now they’re also on the wrong side of the math.

Why reviewing your worst moments matters

This is the part most people skip. After a bad stretch, the natural instinct is to move on. Don’t think about it. Don’t look at it. Just keep going.

But your worst months contain your best lessons.

If you go back and look at what you did during March 2020, or late 2022, or any rough period, you’ll learn something about yourself that no book or article can teach you. Did you sell? Did you hold? Did you buy more? Did you stop checking entirely? Did you check obsessively?

There are no wrong answers here, by the way. The point isn’t to judge yourself. The point is to know yourself. Because there will be another bad month. There always is. And when it comes, you want to be operating from experience, not from instinct.

If you know that your pattern during downturns is to panic around day five, you can plan for that. Set a rule: no trading during the first two weeks of a decline. If you know you start making emotional decisions when you check your portfolio more than once a day, delete the app from your phone during volatile stretches. If you know the dollar amount hurts more than the percentage, stop converting.

The people who came out ahead

The people I know who did best through March 2020 did one of two things. Either they did absolutely nothing, or they bought more. Both required ignoring every instinct they had.

One friend set up automatic contributions and refused to check his portfolio for three months. He told me later that he didn’t trust himself to look at the numbers and not react. So he removed the option entirely. When he finally logged in, his account was higher than it had been before the crash. He hadn’t done anything clever. He’d just stayed out of his own way.

A bad month doesn’t feel like a learning opportunity when you’re living through it. It feels like a crisis. But if you keep a record of what happened and how you responded, you’ll have something invaluable the next time the market decides to remind everyone that stocks can go down. You’ll have proof that you’ve been here before. And you made it through.