Market Volatility and Its Effect on Retirement Planning

The 5 years before and after retirement can make or break your financial future. Here's the uncomfortable truth most advisors won't tell you: It's not just about HOW MUCH you save. It's about WHEN you face market losses. Let me explain: Two retirees with identical savings can have completely different outcomes based on: • WHEN they retire • WHAT the market does in those first few years This is called Sequence of Returns Risk. And it's the hidden retirement killer. Here's why it matters: 1. Market drops early in retirement are devastating        You're withdrawing while your portfolio is down    (The equivalent of bleeding in shark-infested waters) 2. Recovery is harder when taking withdrawals        Portfolio has to work twice as hard to bounce back    (Like climbing up while walking down an escalator) 3. The impact is permanent        Even if markets recover, the damage is done    (You can't un-spend what you've withdrawn) Real example: A $1M portfolio drops 20% in year 1 of retirement? It could run out 10 years earlier than planned. The solution? Create a buffer zone: • Protected money for immediate needs • Growth potential for later years • Clear strategy for both This is why I help my clients build their Bucket Strategy BEFORE they need it. Hoping for good market timing isn't a strategy. Having a plan is. What's your biggest concern about market timing and retirement?

Market corrections and bear markets can be stressful—especially if you're in or approaching retirement. But protecting your assets isn’t about guessing when the market will drop; it’s about having a solid plan in place ahead of time. Here’s how: 1️⃣ Maintain a Diversified Portfolio Spread risk across stocks, bonds, and cash so that a downturn in one area doesn’t derail your entire retirement plan. 2️⃣ Keep a Cash Reserve Set aside 12 to 24 months' worth of living expenses in cash or short-term bonds to avoid selling investments at a loss when markets dip. 3️⃣ Use a Bucket Strategy Think of your retirement savings in buckets: • Short-term (1-3 years): Cash & conservative investments for immediate expenses. • Mid-term (3-7 years): Bonds & income-focused assets for stability. • Long-term (7+ years): Stocks for growth to outpace inflation. This strategy helps you avoid selling stocks during downturns. 4️⃣ Adjust Your Withdrawal Strategy Rather than withdrawing a fixed percentage each year, consider a flexible approach—draw from cash or bonds during downturns and let your stocks recover before tapping into them. 5️⃣ Rebalance When Needed Regularly rebalancing your portfolio keeps your asset allocation in check, controlling risk and aligning with your long-term goals. 6️⃣ Avoid Emotional Decisions Panic selling locks in losses. History shows markets recover, so sticking to your plan is key to long-term success. A market downturn doesn’t have to derail your retirement. With the right strategy, you can stay protected and confident no matter what the market does. Let's connect if you want to ensure your retirement plan is built to withstand volatility. Follow for more tips on simplifying your finances to maximizing your retirement! #Personal Finance #FinancialLiteracy #RetirementPlanning

Most Wells Fargo employees haven’t heard of sequence of return risk. But for soon to be Wells Fargo retirees, it can quietly derail even the most well-funded plan. Here’s what you need to know and what you can do about it. Use these strategies to: ↳ Protect your portfolio ↳ Extend your retirement savings ↳ Create a solid withdrawal plan Understand sequence of return risk • Early losses in retirement can hurt your portfolio. • Even if the market bounces back, timing matters. • A few bad years can shorten how long your money lasts. Why it’s a big deal • A solid average return won’t fix early losses. • Bad years at the start can lead to big problems later. • Your retirement income plan needs to be strong from the start. Control your withdrawals • A steady withdrawal rate, like 4%, can help. • Pulling out too much too soon makes it worse. • Keep your spending in check to protect your nest egg. Withdraw with a strategy • Where you take money from matters greatly. • In down markets, tapping the wrong account can hurt. • Avoid unnecessary taxes and boost long-term growth. Diversify your investments • Mix stocks, bonds, and cash for stability. • Diversification smooths out volatility. • It cushions the impact of market downturns. Sequence of return risk is real but manageable. Plan ahead. Make smart choices about withdrawals, allocations, and income strategy. Remember. Retirement planning isn’t one-size-fits-all. ☑ It’s personal. ☑ It’s strategic. ☑ And it’s worth getting right. What part of your retirement income plan feels uncertain right now? Drop it below or shoot me a message.