The stock market plummets to the lowest all year, experts advise consumers on how to manage money

MISHAWAKA, Ind. -- The New York Times reported that the stock market saw their steepest drop of the year, and many are wondering if we are headed into a recession or if this is a market correction?

This has worried investors and families about what average Americans should do with their money now.

Joseph Fitter, an expert from Indiana University from the Kelley School of Business says these changes are not unusual, but how you respond could make a difference.

“What we're seeing in the market now, which is basically some selling, some activity that, you know, we haven't seen for quite some time. I should mention the last two years, the stock market has been up a tremendous amount, over 20% per year for the last two years. And that's pretty abnormal. That's pretty unusual. And so, some of the adjustment that's happening right now is what we call mean reversion. We're just moving back to probably where we should be," said Fitter.

This is a part of a normal cycle, but the uncertainty will last longer because of Inflation and the Federal Reserve holding off interest rate cuts.

Fitter says after two years of record gains the market is now readjusting with one major factor being inflation, mixing inflation and uncertainty this may last for a while.

Prices are rising faster than expected and the Federal Reserve is choosing not to lower interest rates, this means borrowing money remains expensive for business and consumers, but the opinions remain mixed.

Brian Smith, a consumer in South Bend shares he is in support of the transition, “With the stock market, you know, it's going to be growing pains. I think in six months, if you came back and talked to me, you would say, Man, those tariffs worked out. And look at the stock market, it's up," said Smith.

Then there’s other consumers like Jeffrey Hainey that’s against the decisions that the Trump administration has incorporated.

“This administration has chosen to do every single thing to help the rich, not one thing to help the middle class. They've taken away everything from the poor so they can help the rich, not the middle class,” said Hainey.

The Kelley School of Business expert says the time is not now for emotional moves instead

If you buy into risky investments like Bitcoin, he advises those near retirement to diversify their portfolios to reduce exposure to market volatility.

Every 12 to 18 months the market undergoes a 10 to 15 percent correction and no one can predict the market, so he encourages all long-term investors to stick to their strategies.

“Take a step back, assess your situation, and don't make rash decisions in these scenarios, if somebody comes in and says, Hey, I'm going to go sell everything tomorrow, nine out of 10 times, that's a mistake,” said Fitter.