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By Penelope Wang
June 24, 2016
Postcards featuring the World War II British slogan  Keep Calm and Carry On  are seen outside a newsagents in London, on June 24, 2016. 
            Britain voted to break away from the European Union on June 24, toppling Prime Minister David Cameron and dealing a thunderous blow to the 60-year-old bloc that sent world markets plunging.
Postcards featuring the World War II British slogan "Keep Calm and Carry On" are seen outside a newsagents in London, on June 24, 2016. Britain voted to break away from the European Union on June 24, toppling Prime Minister David Cameron and dealing a thunderous blow to the 60-year-old bloc that sent world markets plunging.
Leon Neal—AFP/Getty Images

Buckle up. Britain’s vote to exit the European Union stunned Wall Street and overseas exchanges, not to mention the British government. The stock market is (over)reacting accordingly, so you probably don’t want to check your 401(k) statement today. Still, as a retirement saver, there’s no reason to panic. You have a major advantage over professional investors, after all—you’re not trying to hedge against the declining pound or unwind derivative bets. Just keep saving for the long-term in a low-cost, diversified portfolio. Easier said than done, of course, so here are three guidelines for riding out market upheaval.

1. Get some perspective. Yes, market plunges are unnerving, especially now that every tick of the Dow is transmitted by TV, smartphones and social media. If you’re feeling anxious, click away from the news and look at financial history—back in March 2009 the Standard & Poor’s 500 was down 40%, but the market rebounded and delivered a historic bull rally. No one knows where the market will go from here, which is all the more reason to stay diversified. But stocks remain your best bet for long-term growth.

2. Review your asset allocation. This is not the time to start tweaking your portfolio. But you do want to make sure that you asset mix fits your goals and risk tolerance. If you are finding it difficult to sit through this kind of market volatility, you may want to ratchet down your stake in stocks. But don’t sell during the crisis—instead direct future contributions to bonds and cash. (And if you’re nearing retirement, you should already be doing this.) Better yet, talk with a financial adviser who can help you find a more suitable allocation. Meanwhile, everyone else should consider rebalancing back into stocks if the market continues to sag.

3. Control what you can control. In the end, your own actions will have a lot more impact on your retirement security than what happens in London, Brussels or Washington. So stay focused on the areas you can have the most impact, including keeping your career skills up to date and saving as much as you can. Remember, over the long run, the amount the stash away in your 401(k) has a far bigger impact than the returns you earn. So don’t rely only on stocks to build your portfolio. Those monthly contributions remain the key a comfortable retirement.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

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