How Much Cash Needed During Retirement When Living Off of 401K earnings and social security
My husband and I are 70 years old. We are living off of our social security and earnings from our 401K which is a mix of mutual funds and stocks. We had 1,200,000 in March and with the market dropping it is currently at 1,000,000. We have $52,000 in cash. How much money do you recommend we have in reserve/cash (maybe in CDs) so we don’t have to sell stock when market is on a downturn. We typically ride it out but at our age maybe we should be using a different strategy. Thank you, Denise
Terry Says
Welcome to the impact of a bear market during retirement! Yes, your time horizon has changed. I can’t give advice blindly without knowing your entire financial picture. That is why you need to find a TRUSTED financial planner (not salesman) to help you with this issue. You can be matched with one at www.Wealthramp.com — use this link to read how it works.
But as a wild guess, I’d say that you are already worried. And since I think the market could go much lower, you should raise some cash. There’s an old Savage Truth (and long-time market saying) “Sell down to the sleeping point!”
