The general idea is that as you get older, stocks gradually become a less desirable place to keep your money.

Your age is a major consideration, and so are your particular risk tolerance and investment objectives. This is a concept known as asset allocation, and a few factors come into play here. Now let's talk about what to do with your investable money - that is, the money you won't likely need within the next five years.

Money you're socking away for a down payment, even if you will not be prepared to buy a home for several years.

Money you'll need to make your child's next tuition payment.In 2020, during the COVID-19 pandemic, the market plunged by more than 40% and rebounded to an all-time high within a few months. While the stock market will almost certainly rise over the long run, there's simply too much uncertainty in stock prices in the short term - in fact, a drop of 20% in any given year isn’t unusual.

The stock market is no place for money that you might need within the next five years, at a minimum. Decide how much you will invest in stocksįirst, let's talk about the money you shouldn't invest in stocks.

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