'It's going to get much uglier' — How to invest during the coronavirus pandemic, according to Ric Edelman

The coronavirus pandemic is far from over, so knowing how to deal with your investments is important, says top investment advisor Ric Edelman.

"This is ugly right now, and it is going to get much uglier," he said, referring to the pandemic.

"My biggest concern is that most people have not come to terms with how bad things are going to get and how long this is going to last."

The pandemic has yet to reach its peak in the U.S. When that will happen is unclear. 

U.S. health officials have said that a vaccine ready for public use could take 12 months to 18 months. However, pharmaceutical companies are scrambling to come up with potential treatments.

Meanwhile, businesses have shut down and jobless claims have also soared.  U.S. lawmakers have responded with a $2 trillion stimulus bill to rescue the economy. It passed the Senate Wednesday night, and the House approved it Friday. It now heads to President Donald Trump's desk.

More from Invest in You:
Alternatives for quick cash better than withdrawing from 401(k)
How to ensure coronavirus outbreak doesn't hurt retirement savings
Some women may take an extra financial hit from pandemic

All of this has rocked the market — sending it plunging, rebounding and then back down again. 

The Dow Jones Industrial Average hit its lowest level in three years last week. It then rallied, posting its biggest three-day gain since 1931 on Thursday. Despite those gains, the major averages were still more than 20% below the record highs set last month. 

On Friday morning, stocks fell sharply again. 

Edelman is telling clients not to change their portfolio, as long as they are properly diversified and have an appropriate cash reserve.

However, what you should do depends on your age and where you stand financially, said Edelman, founder of Edelman Financial Engines, ranked the No. 1 top registered financial advisory firm by Barron's in 2019.

If you are young, you have decades to recover, financially speaking.

"If you have a long-term time horizon and you are able to sustain yourself and your family during this period, you just grin and bear it," Edelman said.

That means you should have an emergency fund already in place, are secure in your job and can pay your bills.

In fact, the downturn could be considered a buying opportunity.

"The stock market is on sale," he said. "We haven't seen an opportunity like this since 2008."

Remember, in the 10 years after the market hit bottom in 2009, the S&P 500 has delivered a 10-year annualized total return of 17.8%.

However, if you have gotten laid off or furloughed and don't have any money in a cash cushion account, then you may have to consider potentially extreme measures.

That could mean moving in with other members of your family, tapping into credit cards or borrowing money from other resources where available.

As a "last resort" you can borrow from your 401(k), Edelman said.

If you decide you want to reduce your exposure to equities in your portfolio, chances are your stock fund or stocks still have made a profit since you bought in — which means you'll have to pay taxes on any profit. To avoid that problem, Edelman suggests selling those investments that have incurred losses since you purchased them. You'll instead get a tax deduction instead of having to pay.

However, if you sell, you'll also miss out on the recovery when it happens.

"You are locking in your losses and that is never advisable," he said.

If you are nearing retirement, start building your cash reserve. That means if you have to sell some assets, do so, Edelman said.

"If you are going to spend the money in six months or two years, it shouldn't be invested in stocks because anything can happen in two years," he said.

You may also want to consider delaying your retirement. Instead, keep working for another year or two.

"Wait for this crisis to be over and reevaluate."

If you are retired and have substantial cash reserves in place, then consider stopping income from your investments right now — and use your cash to pay the bills.

"You don't want to sell investments when the market is down if you can afford it," Edelman said.

"You have a rainy day fund for this," he added. "We are experiencing a downpour."

If you don't have a cash reserve, then begin to use your pension or Social Security benefits if you were otherwise trying to delay them.

If not, you'll need to try to radically reduce your expenses, which may mean moving in with family members.

"You may need to take extreme steps because this is an extreme situation," Edelman said.

SIGN UP: Money 101 is an 8-week learning course to financial freedom, delivered weekly to your inbox.

CHECK OUT: 7 side hustles you can do while working full time that can pay as much as $150 per hour via Grow with Acorns+CNBC.

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.