Jun 27, 2019
This week, I’m talking about the danger of retiring during a recession. The problem with retiring during a recession is that your investment portfolio will also likely drop - 10, 20, or even 30% or more, which can derail your plans for retirement.
Today, let’s talk about stress testing your retirement. By stress test, I mean that you take a look at your portfolio as it’s invested today and you backtest it by looking at how much it dropped during all of the last market crises of the last 20 years. This includes the Great Recession of 2008, the WTC attacks, the tech bubble, as well as a handful of other big drops in the stock market.
This is an important exercise, since understanding how your currently portfolio would have held up (or didn’t hold up) in a number of stock market drops, you’ll better understand how risky your current portfolio is and how to take steps to lower your risk if you find that your current portfolio dropped more than you would be comfortable with.
We stress test all of our client portfolios, and it’s a key part of our review process for clients. If you would like me to stress test your portfolio - no strings attached - just send me an email at ashleym@truenorthra.com , that’s a-s-h-l-e-y-m@truenorthra.com to get started.
That’s it for today. Thanks for listening!
My name is Ashley Micciche and this is the One Minute Retirement Tip.
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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, fee only financial advisor, financial planner, retiring soon, retirement concerns, recession