SALT LAKE CITY -- Time is ticking toward the first of the year and the so-called "fiscal cliff," where several tax cuts expire and spending cuts go into effect.

Though the prospects may be scary to those invested in 401k plans and stock portfolios, agents appear to be urging clients to stay the course and not pull out of their investments.

"The market reacts to investor sentiment and so you can see a lot of fluctuation in the market. I think people tend to get caught up in the here and now and forget long-term perspective and what their plan is," said Sharla Jessop, vice president at Smedley Financial Services downtown.

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Being reactionary, Jessop suggested, can cost because investors usually don't have good timing in buying back into the market for the rebound.

"That's the hardest part - people who get out of the market often don't get back in when they should. They miss those big upswings and that's a large part of growth," Jessop said. "We never know when that turnaround is going to be."

The anticipated effects of the "fiscal cliff" are likely already - in large part - factored into the market, Jessop said, though she acknowledged some adverse effects could be seen depending on how much lawmakers drag their feet.

"Large investors, large companies, large money managers - they're making changes well in advance based on what they see coming down the pipeline," Jessop said. "So a lot of the change that you see and a lot of the volatility in the near-term is more reaction to people who haven't done anything."

The "fiscal cliff" is certainly enough to give a lot of people pause. At the same time and barring action from Congress, Bush-era tax cuts are set to be phased out, as are social security payroll tax cuts enacted in 2010. Mandatory government spending cuts are also slated to go into place at the first of the year.

Estimates of the impact of the tax cuts going away range in the neighborhood of $3,500 per household next year, though economists point out the stat may be skewed by households with higher incomes.

Middle-income households are expected to see about a $2,000 hit.

At the University of Utah, associate political science professor Matthew Burbank said he didn't anticipate a comprehensive deal being done by the end of the lame duck session of Congress.

"I would expect some kind of moderate level, term decision so that we avoid the worst possibilities," Burbank said.

His prediction comes with a measure of practicality. Burbank did not believe lawmakers had enough time before the end of the year to resolve differences and come up with meaningful reform and a comprehensive plan for the future. He also suspected outgoing members of Congress may have some apprehension in having a vote on such a significant issue.

"I think the real issue is going to be is there enough statesmen-like action on behalf of the Obama administration and new members of Congress to be able to make this deal and not simply resort to political name-calling and trying to blame the other side," Burbank said.

"We've seen a lot of that already, but given what we saw with the debt ceiling it's entirely possible a deal doesn't get made, and that would be a real problem."

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