How to Ease Your Worries About Unstable Markets in Retirement

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How to Ease Your Worries About Unstable Markets in Retirement

When you’re investing for retirement, your main task is to establish a long-term goal and plot out a portfolio that will get you there. But it’s also crucial to be on guard against major disasters like running into a bear market just as you’re about to retire, or more importantly have just made the transition.

Protecting Your Retirement

Morning Star‘s Jeremy Glaser recently interviewed their director of personal finance Christine Benz, who emphasized volatility has come back in a big way in 2018, with worries from everything from inflation to new tariffs.

“…If you have done nothing to your portfolio during this great bull run that we’ve all experienced, your portfolio has gotten progressively more equity-heavy, and in turn, it’s more vulnerable to volatility in the equity market.”

Hanging on to Quality Shares

In choppy markets, “high-quality” stocks tend to hold up better than speculative fare. Look for funds with stable earnings, low debt, and a history of being able to deliver shareholder returns regardless of market conditions.

Benz suggests looking for funds which act as “a hybrid of a yield-centric strategy as well as a growth-oriented strategy.” This will help “to shade your portfolio toward higher-quality stocks which I think will give you a little bit more of a hedge in high volatility markets.”

Lighten up on low-quality bonds, where defaults are on the rise

While junk bond funds offer higher yields than investment-grade debt, they’ve fallen 8% on average on a total return basis over the past year.

Benz suggests, “In retiree portfolios, sometimes the noncore asset classes, whether it’s emerging-markets equity or a high-yield bond, give retirees a lot of worries and aren’t making a meaningful difference in the portfolio’s returns… I think it’s a great time to think about simplifying, moving toward quality, and shading a little bit more toward conservative investments overall.”

Enjoying Your Retirement with CKS Summit Group

Retirement is meant to be enjoyed. Watching your portfolio bounce around is unnerving at any age, it’s especially tough for those who thought their retirement plan was safe, secure and protected.

We believe professionally managed tactical stock market and non-stock market portfolios can provide healthy, long-term upside growth potential. It can also be very effective at preserving principal while allowing for a high degree of downside risk protection.

Let’s set up your complimentary strategy session. By doing so we can ask the right questions that enables us to offer retirement income options for you.

Call us today on 586-286-5820 or simply click here to schedule your session online.