Nila Sweeney
Lately the message from the media about finance and markets has been all doom and gloom. Both at home and abroad some would have you believe the sky is falling.

Although it’s been a very nasty couple of weeks for some investors, and even major economies such as the US and European markets, it’s not time to head underground for most of us at home just yet.

Your Money Magazine shows you how the current market activity may affect your investments, mortgage, savings and super.

What’s been going on?
The Australian stock exchange (ASX) has been taken on a rocky ride at the hands of financial chaos in the US and throughout Europe.
Shares had already been taking a beating due to the debt crisis in America, and the threat of defaults in Greece, Portugal and Ireland. With the credit rating of the US being downgraded from AAA, the general uncertainty led to whopping losses on global markets as well as on the ASX.
Remember: Since last week the markets have inched better, but there is still a long way to go.
Official interest rates look set to remain steady, and already we’ve seen major banks including Commonwealth, Westpac, St George and ANZ cut fixed rate mortgages by as much as 60 basis points to 6.44%. See Is now the time to fix your mortgage?
Regardless of what the RBA decides for the next official rate release, now may just be the time to take advantage of these bargain rate offers, setting yourself up for the next three years.
Having at least part of your portfolio in cash savings is one way to play it safe regardless of stock market troubles. 

However keep in mind that you’re unlikely to get a good return on your cash. Low interest rates spell measly returns for savers, however as always it’s worthwhile to shop around, and strongly consider an online savings account.
Financial advisors have broadly recommended that investors avoid any temptation to sell in the current climate. While it hurts to see your share prices plummet, never forget that your losses are only realised if you sell. Analysts suggest investors hold their nerve, as selling now may mean you experience huge losses.
It is important to view your investments through a long lens, as rarely will you make short-term gains. Think long term and remember that equities generally outperform cash over 10 years or more.
Some investors tend to see big falls in the market as a signal to buy. This is because you can buy generally well performing shares at bargain prices. Related article: Blue-chip shares emerge from bloodbath

$40 billion of superannuation was wiped off the market last week, and although that sounds grim, now may be just the time to review your retirement outlook. 

Keep in mind that many advisors suggest keeping only a limited percentage of your superannuation in the share market, and to keep your portfolio diverse. Related article: Safeguard your super

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