The worst weekly slide since 2008, U.S. stocks dropped approximately 13% as of Friday afternoon. While not good news, Certified Financial Planner Joe Gugino of Fredonia’s Gugino & Ryel Financial said recent declines are no reason to panic.

“What I’ve been hearing and seeing is that there is going to be some short-term volatility,” Gugino told the OBSERVER. “With that, this quarter and the next quarter are really going to have some major disruptions, but long term, it’s going to be fine. Long-term risk really has not changed.”

Gugino noted that global concerns about the coronavirus have played a significant role in the stock market’s recent decline. “Supply chains have been disrupted because China has basically ground to a halt,” he explained. “But China is getting a grip on the virus, and the economic engine will pick up again.”

Gugino pointed out that approximately 70% of the U.S. economy is consumer-based, which makes the impact of events such as the coronavirus relatively short lived. “Americans love to spend; we love to travel, and that’s certainly not going to change because of a virus that is being dealt with,” said Gugino.

He recalled similar changes in the market when SARS, swine flu and other viruses broke out. “It is a typical reaction, but the biggest difference between the coronavirus and the others is how quickly the markets reacted to this one,” he said. “This one came on within a week’s time; we went into a correction, and that hasn’t been seen since the crash in 2008. We’ll get over this, though.”

Even before the coronavirus outbreak, Gugino was preparing his clients for a dip in the markets because it is a presidential election year. “I was preparing people for this, not because of Bernie Sanders, but just that there are two different ideals that are going up for election this coming year,” Gugino explained. “The field is just really uncertain. … It doesn’t really matter if it’s a Democrat or a Republican going up for re-election– the possible changing of the guard down in Washington always affects the markets. The uncertainty of the election did add to this, but the biggest thing was the virus.”

Over the past week, Gugino has received many calls from concerned clients, and his advice is simple. “What I’ve been telling people is, we have an investment plan. When things seem uncertain and panic starts dominating us, let’s revert back to our plan,” he said. “Let’s stay focused because it’s very easy — downside or upside — to veer from that plan.”

According to Gugino, the downside — when the markets drop — results in fear-based dissection. However, the upside — when the markets are up — can result in greed-based decisions to take potentially dangerous investment risks. “Staying in a well-balanced portfolio and sticking to your plan is key,” said Gugino.

This week, Gugino has reminded his clients of the fourth quarter of 2018. “That quarter, we were down close to 20%,” he recalled. “Here, we’re only down 12 or 13%. The difference is, again, the short term. In the last 15 minutes that we’ve been talking, the market has gone up over 400 points. We’re still negative, but that goes to show how much things can change in a short amount of time.”