The closer you get to retirement age the less likely you’ll be able to tolerate losses that can come with high-risk investing. Reevaluating your investment strategy when nearing retirement is crucial to protect the nest egg you’ve built, but there are no hard or fast rules as to when to make changes. Your age, financial situation, health, and lifestyle goals will signal when it’s time to switch from a moderate or aggressive investment strategy of high-risk and reward, to one that is considered safe to preserve assets.
When it comes to market volatility, it’s not a matter of if the market will hit a downturn, it’s a matter of when. Someone who is twenty or more years away from retirement age has the time needed to take risk and suffer losses and then recoup them. An individual nearing retirement age doesn’t have the luxury of time. If you’re not sure if your investments reflect your current risk tolerance and time horizon, sit down with your fiduciary financial planner, and take a serious look at your portfolio. If there’s any chance that you will need to sell off investments to have cash to live on during a market downturn in retirement, it’s time to reevaluate your investment strategy.
Alloy Wealth Management believes in ongoing reviews and updates with clients to ensure their investment strategies and retirement or estate plans reflect their current financial situation, lifestyle, and future goals. If you have questions about your portfolio, or need help with Social Security filing strategies, call us at 800-689-3935.