As announced by the Prime Minister last night, new restrictions are currently being implemented on Australians' ability to socialise, go to work and even leave the house.
These are trying times and a significant disruption to daily life for us all.
But with income uncertainty now hanging over a lot of Aussies' heads due to the economic disruption that the coronavirus pandemic is causing, many people might be wondering whether this is a good time to be putting hard-earned cash into what is an extremely volatile share market.
In my opinion, there are two things to keep in mind when thinking about investing in today's share market:
1) ASX shares are cheap right now
The share market is undeniably cheap right now. Many ASX shares, including blue-chips, have been heavily sold off and a few (such as the ASX banks) are at multi-year lows.
Now, I'm not in the business of calling what happens next. The S&P/ASX 200 Index (ASX: XJO) has rallied today (up 1.68% at the time of writing), but it may well go up or down from here. We may have seen the bottom yesterday, or the bottom might be a week or a month (or three) down the road. I have no idea.
But that doesn't change the fact that I think there are many ASX shares that are presenting great value for money on today's market. Buying some top-notch ASX companies at current prices might be a great move to make when looking back at this crash in a few years' time.
2) You shouldn't be investing if you're not sure if you'll need the money
In all circumstances, I firmly believe that you shouldn't be investing any money that you might need in at least the next five years. It's a trying time for many families out there right now, and I understand that income security is now far more important than it might have been just a month or two ago.
So if you're not completely certain that you and your family won't need to put any extra cash aside for a rainy day right now, you shouldn't be investing it. The last thing needed in these difficult times is having to sell down shares at a significant loss – which is a distinct possibility in the coming months. An ASX share portfolio is a great long-term investment, but it is not a reliable piggy bank you can break open in times of trouble.
Foolish takeaway
If you're looking at today's share market and seeing a raft of opportunities, I congratulate you! That attitude is a great mindset to have for long-term wealth creation. However, investing cash you might need in the next year or five is equally a terrible idea. So be careful and judicious with your money today – you want your future self to thank you, not rue your mistakes!
