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Don’t Let Market Volatility Ruin Your Retirement

Don’t Let Market Volatility Ruin Your Retirement
Now that you’re nearing retirement, the term “market volatility” might stir up different feelings than it 30 years ago. Older workers and retirees understand that they have less time to make up for losses in their investments and to ride out future market crashes than they did when they were younger. And with life expectancies increasing, leaving your financial wellbeing up to the whims of the market seems like less and less of a good idea. We know that there will always be crashes, even if no one knows exactly when they will come, so why not develop a plan ahead of time?

After a crash, people may be tempted to sell their stocks if they panic, or need immediate funds. But in doing so, they ensure that they won’t see the stock appreciate when the market recovers. In order to keep this panic at bay, you can think of creating your portfolio around the idea of retirement income.

Creating reliable retirement income can be a good retirement strategy for high-income earners. The first step would be to create guaranteed retirement income with “safe” investments. The value of bonds and savings account are not seriously affected by the ups and downs of the market, and reliable paychecks include Social Security, annuities, and bond ladders. Certain annuities will also protect against outliving your retirement savings.

After covering your basic needs with safe investments, you can look to grow the rest of your savings more aggressively. You can think of the funds generated as “retirement bonuses.” These “bonuses” can be used for non-necessities like travel, spending of grandchildren, and the activities you want to enjoy with your free time in retirement. You can develop a withdrawal plan based on market performance, meaning decreased withdrawal amounts when the market drops, and increased amounts when it experiences gains.

It’s also important to create an emergency fund for events like unexpected medical expenses and home and car repairs. This fund will be separate from your first two funds, so if there is an emergency you will not have to disrupt the overall structure of your retirement plan by dripping into them.

The term “market volatility” probably doesn’t create good feelings if you’re nearing retirement or already retired. Developing a plan for periods of market volatility before they happen can help you weather storms.

You don’t know when the next crash is, but you can plan for it. Click here to schedule your complimentary review today, and let the professionals at Peak Financial Freedom Group help you create reliable retirement income, sources of growth, and an emergency fund for a rainy day.

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Roseville, CA 95661

DISCLOSURE: All presentation data is provided and intended to be used for general educational purposes only and is not intended as a solicitation for you to buy or sell any financial product. None of the material in this presentation is intended to give you, nor are the presenters engaged in giving you, specific tax, investment, real estate, legal, estate, retirement, or financial advice, but rather to serve as an educational platform to deliver information; nor is it intended to show you how the strategies presented can specifically apply to your own tax, investment, estate, financial, or retirement position, but rather to offer an idea of how these principles generally may apply.

Stocks, bonds, or mutual funds have risks and can lose principal, even with a stop loss, and there is no guarantees of gains, as past performance is not indicative of future positive investment results. The sale or liquidation of any stock, bond, IRA, certificate of deposit, mutual fund, annuity, or other asset to fund a new portfolio and/or annuity may have tax consequences, early withdrawal penalties, or other costs and penalties as a result of the sale or liquidation. You can’t invest directly into a stock market index. A fixed index annuity with an income rider can protect your savings from losses and provide you guaranteed lifetime income, but you could incur surrender charges, gains aren’t guaranteed, you’ll pay a fee, and guarantees are backed by the financial strength claims paying ability of the issuing annuity company.

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