Stocks tumbled this week amid growing concerns over the economic impact of President Donald Trump’s tariffs.

The benchmark S&P 500 avoided correction territory ‒ defined as at least a 10% decline from a recent high ‒ and ended the day down 0.76% at 5,572.07 points, up from a daily low of 5,528.41. The Dow Jones Industrial Average dipped 1.14%, while the Nasdaq composite fell 0.18%.

Investment strategists told USA TODAY that the recent dip is no reason for Americans with retirement accounts such as 401(k)s to panic, no matter what stage they’re at in life.

“The people who would be hurt by (the stock market dip) are the emotional ones who are likely to do something irrational,” said Sam Stovall, chief investment strategist at investment research and analytics firm CFRA Research. “That could be somebody at any age.”

Why is the stock market down?

Investors have gotten jittery amid growing concerns over the state of the U.S. economy.

Surveys show consumers are feeling less optimistic, and a number of retailers have warned that consumers may be pulling back on spending.

Stocks dipped Monday after Trump declined to rule out a recession this year, and the selloff continued Tuesday after Trump said he’ll double U.S. tariffs on Canadian steel and aluminum. He abruptly changed course Tuesday evening.

Just how long the selloff lasts will likely depend on Trump’s tariff plans, according to Stovall.

“Should the president decide that we’ve gotten enough concessions from our trading partners, then I think the market would experience a sharp rebound,” he said. “But the longer the trade disputes linger, the deeper the market will eventually fall.”

What does this mean for younger Americans’ 401(k)s?

Selloffs are “wonderful opportunities” for younger Americans who are just starting to build out their 401(k), according to Ryan Detrick, chief market strategist at financial services firm Carson Group.

“They say the stock market’s the only place where things go on sale, yet everyone runs out of the store screaming,” Detrick said. But “for longer-term investors, it’s important to remember: scary headlines and volatility happen every single year. And the truth is, 2025 is not any different.”

Stovall said younger Americans should stay the course with their investments and make sure to take advantage of the “free money” their company may be offering through a 401(k) match. If able, now may be the time to look into boosting their monthly contribution. At minimum, Stovall said they should aim to invest enough to receive the maximum match from their company.

“Time is the great neutralizer of volatility. The longer you have, the less your portfolio will have felt these market upsets,” he said.

What does this mean for older Americans’ 401(k)s?

For Americans nearing retirement, Stovall said there is likely still plenty of time to make up for lost ground from the most recent dip, especially since the stock market tends to bounce back quickly.

A historical analysis from CFRA shows that so long as the stock market doesn’t fall 20% or more and enter bear market territory, it takes on average four months to recover from a correction.

“Don’t let your emotions become your portfolio’s worst enemy,” Stovall said. “The only way to lose money is by selling what is down.”

Detrick added that older Americans should, ideally, have a more diversified portfolio that’s able to weather selloffs.

“For someone closer to retirement, diversification is your friend,” Detrick said. “To have some gold, to have some bonds, to have some cash, to have some stocks … that should be what they’re thinking about right now.”

Tom Hainlin, senior investment strategist at U.S. Bank, said Americans should make sure they’ve got enough cash available for short-term needs, then focus on making sure they’ve got the right asset allocation for their long-term goals.

“So that’s the right mix of cash, stocks, bonds, real estate or what have you,” he said. “We think as long as you have those correct, then you can endure these periods of market volatility.”

White House spokesperson addresses stock market dip

The stock market dip comes as the Trump administration is downsizing the federal workforce.

When asked if the stock market dip will make federal workers more hesitant to retire, White House Press Secretary Karoline Leavitt on Tuesday defended Trump’s tariffs.

“There’s great indication to be optimistic about where the economy stands,” Leavitt said.