Woman with surgical mask (Photo by michaelheim / Shutterstock.com) In just the last week, fear surrounding the coronavirus COVID-19 has erased trillions from the U.S. stock market. This is a true black swan event: one that nobody saw coming and nearly everyone underestimated. So much for history. What now? Let’s look at your options for both stocks and savings accounts. Stocks: Keep calm and carry on If you’ve got a time machine and can travel back to mid-February when the Dow Jones Industrial Average was approaching 30,000, go back and sell everything. If that’s not an option, however, the thing to do now is … nothing. The market is already flirting with correction territory (a decline of 10% from recent highs) so it’s probably too late to get out now. If the coronavirus becomes a true global pandemic along with a global panic, I’ll regret that advice. But from what we know now, sitting tight is probably the best idea. That being said, while I wouldn’t advise reducing your stock exposure, I would definitely advise reducing your expectations, at least for the short term. Prior to the coronavirus outbreak, Wall Street consensus was for 7% earnings growth this year, with similar growth for stocks. On Thursday, Goldman Sachs revised its estimate to zero growth. That’s how much economic damage the virus has already caused. The bottom line for stock investors? That depends partly on your situation: If you’re investing monthly through a 401(k) or other retirement plan, and have decades until retirement, you’re in fat city. Stocks are on sale and may get cheaper yet. Don’t change a thing. If you’ve got money on the sidelines, keep it there for now. Nobody, and I mean nobody, knows where this is going. Keep some powder dry. If this sudden stock market drop has you in a panic, you may have too much money in the market. While this coronavirus is unique, sudden sharp declines in the stock market aren’t. Consider this a lesson and allocate accordingly. Here’s my advice on how much to have in stocks. Savings: Lock in rates As I said, there’s already been enough damage from the effects of the coronavirus outbreak to slow the world economy. And what do governments do when growth dries up? They prime the economic pump with lower interest rates. The futures market is now pricing in the odds of the Federal Reserve lowering its benchmark federal funds rate this year at roughly 85%. Just a few weeks ago, those odds were 50-50. So what’s a saver to do? Lock in rates now, before they go lower. As I write this, you can still lock in a 2% interest rate on a certificate of deposit (CD). I know, nothing to write home about. But it’s probably a higher interest rate than your savings account is paying — and it may look good if the economy tips into a recession. Should you lock up all your savings? Absolutely not. The coronavirus scare may be over before you finish reading this, growth could resume and savings rates could head higher. But a little hedging, along with a pinch of diversification, never hurt anybody. So take a minute and compare CD interest rates.