Upcoming market
I’m retired (71 years old). My IRA consists of 56 percent equity / 44 percent fixed income and 50,000 in Roth IRA. My advisor has me as a risk of moderate. Should I get out of the market with the election coming. Hearing stories of possible 20 percent drop in the market. Please give me your opinion. Thank you,
Terry Says
First, think about this: There is ALWAYS a chance of a 20% drop in the market! We just never know WHEN it will happen!
As we get older, we get more conservative. And that make sense emotionally, if not financially. So you need to deal with it.
Over the long run — and statistics say you do have a “long” run left– you need the growth provided by the stock market to offset any future inflation. There has never been a 20-year period where you would have lost money in a diversified stock portfolio with dividends reinvested.
YOu didn’t say what percentage of your savings is in the traditional IRA and what portion in the Roth IRA (or how the Roth is invested). What if you leave your money in your traditional IRA invested just the way your advisor has suggested. It seems a pretty conservative allocation.
BUT, just have all your Roth IRA in a money market fund. Yes, all in cash. Then if the stock market does decline, you’ll sleep well knowing you have all that cash to live on for a while till the market rebounds. And it will — eventually.
Then never look back. Just enjoy your retirement with more peace of mind.
