Retirement Playbook: How Portfolios Can Bounce Back From Down Markets

It’s easy to get caught up in discouraging economic news, and lose sight of your long-term financial roadmap.

That’s why Mari was glad to have a conversation with veteran financial journalist Gail MarksJarvis, writing for Barron’s, about how retirees can stay on track by taking positive steps to protect their portfolios in times of turbulent markets.

Feelings of insecurity are common among retirees during a market downturn, writes MarksJarvis, as they worry about outliving their savings.

But going back in time and analyzing the bear markets of 2000-02 and 2007-09 may allay some concerns. Small spending cuts, and waiting patiently for markets to rebound, would have returned retirees to a position of safety.

Mari talked with Gail about small steps that can help retirees keep their portfolios – and their financial lives – on track.

  • Since Required Minimum Distributions (RMDs) are optional this year, Mari suggests waiving or reducing your 2020 RMD withdrawal to lower your taxes, and give your portfolio an extra boost and time to recover.
  • Monitor your portfolio withdrawals every year, and try to make sure they stay at or under 4% of market value, or the slightly-higher IRS-recommended amount if you’re an older retiree (ask your financial advisor for help calculating the correct amount).
  • Even though turbulent markets can be scary, says Mari, you’ll obtain better results if you ignore the market gyrations and keep your investment allocation on course.

You can read the full Barron’s article by Gail MarksJarvis here: “How Modest Spending Cuts Can Take the Sting Out of Down Markets for Retirees.”

Want more info on Required Minimum Distributions? Visit our article “Breaking News: IRA Withdrawals Are OPTIONAL For 2020.” We share tips on the 2020 withdrawal strategy that best suits your style.

 

Mercer Global Advisors Inc. is registered with the Securities and Exchange Commission and delivers all investment-related services. Mercer Advisors Inc. is the parent company of Mercer Global Advisors Inc. and is not involved with investment services.

About Mari Adam

Mari Adam, Certified Financial Planner™ and President of Adam Financial Associates Inc, has been helping individuals and families chart their financial futures for over twenty-five years. Have a question about your financial situation? Ask Mari!

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