In times of an impending hurricane we tend to rush to the grocery store, gas station and hardware outlets to panic buy. Anything we can remotely think about — from candles to duct tape to generators. The world seems to be coming to an end over the next 48 hours, so we need to buy as much stuff as we can think about. Even if we bought food yesterday, we feel compelled to “stock up” again today.

They call that impulse buying.

But there is also a phenomenon called impulse selling. The desire to sell in a panic situation.

The principle is the same as panic buying. The fear of losing out on something. In the case of panic buying we’re scared we’ll run out of food and other essentials but in the case of panic selling we are usually in the world of money.

In other words, when we hold investments and they go down in value we’re scared we may lose more than we already have lost. So, we “cut and run”.

There is nothing inherently wrong in selling to cut our losses if the circumstances are evidently not in our favour. In fact, there are times when we simply should sell and move on.

Truth be told, this writer could easily entertain you with tales of his own obstinacy about not selling when everyone in the world knew better. But I won’t embarrass myself.

There is a feeling that things will get better over time and thus we should just hang on until the tide turns. There is much merit to that approach and every investment expert (clearly, I am not one) will strongly advise you to think before you leap.

A sudden drop in value is only worrisome if the drop is enormous. But if the overall market has gone down slightly and the particular investment has correspondingly dropped then the need to sell is most likely not necessary.

Even if the market goes up and the investment itself goes down, the need to sell is probably not necessary.

Yet unfortunately many people run scared very quickly if the value goes down. They see their long-term savings plan in jeopardy. Especially if they are approaching the retirement years the fear of running out of money when there is no employment income is scary. In theory that is a fair concern.

But if your retirement is 20 years away then why should you be worried if the market goes down for a few days or weeks?

You shouldn’t. Stay calm and focused. By all means monitor the offending investment closely and track its movements for a few days. Read some investment reports that have forecasts included. Speak to your financial adviser. Maybe just sleep on it.

Long-term investing is complicated. It is impossible to predict the stock market with any level of accuracy. Even the experts get it wrong.

Long-term investing is more than arithmetic. It involves a range of personal needs, likes and dislikes. Only you can figure out how much money you will need for that new house or for school fees or for retirement. While we all think we want more and more money, we should take into account how much we really need and balance our lifestyle and investing accordingly.

Why would we take a gambling approach to investing where we take silly risks and make poor decisions based on whims or some “hot stock” a friend mentioned over coffee?

A balanced and sensible approach, with ample diversity (the eggs in the basket syndrome) with a realistic target of income and value will succeed every time. There will be ups and downs of course, but the urge to sell when the stock market has a bad hair day is short-sighted.

It’s not good for your peace of mind, your health or your hair.

• Join me and Zuri Darrell this Thursday (27th) for our next Seminar on Saving and Investing with Butterfield at the Bank, Reid Street from 5.30 to 7.30pm. Register for free at Eventbrite http://bit.ly/2JFvVFa

Bill Storie is CEO of The Olderhood Group Ltd, a Bermudian company and exclusive Bermuda partner of Career Partners International, with more than 350 offices worldwide. He is also producer and host of The Ozone, a weekly radio show on Magic 102.7FM. He can be reached at www.olderhoodgroup.com or Bill@olderhood.com