That uncertainty can be even more unsettling for near-retirees<\/a> who are preparing to leave the workforce and tap portfolios for living expenses, experts say.<\/p>\n To that point, your first five years of retirement are the “danger zone” for tapping accounts during a downturn, according to Amy Arnott, a portfolio strategist with Morningstar Research Services.<\/p>\n If you take assets from accounts when the value is falling, “there’s less money left in the portfolio to benefit from an eventual rebound in the market,” she said.\u00a0<\/p>\n Some 4.18 million Americans<\/a> in 2025 are projected to reach age 65, more than any previous year, according to a January report from the Alliance for Lifetime Income.\u00a0\u00a0<\/p>\n More from Personal Finance:<\/strong> ‘Protect your nest egg’<\/p>\n After several years of stock market growth, it’s important to “protect your nest egg” by rebalancing based on your risk tolerance and timeline, said CFP Jon Ulin, managing principal of Ulin & Co. Wealth Management in Boca Raton, Florida.<\/p>\n If you’re in your early 60s, you may shift assets closer to a 60\/40 investment portfolio, which typically has 60% stocks and 40% bonds, he said.<\/p>\n However, that could include additional diversification<\/a>, depending on your risk appetite and goals, experts say.<\/p>\n Alternatively, if you’re struggling with the latest market drawdowns, you may prefer a more conservative allocation, Baker said.<\/p>\n “This is a good time for a temperature check” to make sure your portfolio still matches your risk tolerance, he added.<\/p>\n Build your cash reserves<\/p>\n Typically, it’s best to avoid selling investments when the stock market is down, especially during the first few years<\/a> of retirement, experts say.<\/p>\n The phenomenon, known as “sequence of returns risk,” shrinks your nest egg early, which hurts long-term portfolio growth when the market rebounds, research shows.<\/p>\n CFP Malcolm Ethridge, founder of Capital Area Planning Group in Washington, D.C., suggests keeping two years of income in cash within a couple of years of your planned retirement date.\u00a0\u00a0\u00a0<\/p>\n The strategy protects from early losses because retirees can tap cash reserves for living expenses while their portfolio recovers, he said.<\/p>\n There’s also a “psychological aspect” because the cash provides confidence to spend portfolio assets, which “sets the stage for the rest of retirement,” Ethridge said.<\/p>\n Amid bond market volatility<\/a>, older investors may also consider building a bond ladder<\/a> to provide portfolio income, said Alex Caswell, a San Francisco-based CFP at Wealth Script Advisors.\u00a0<\/p>\n This investment strategy involves\u00a0purchasing a range of shorter-term Treasuries with staggered maturity dates, providing a steady income stream while managing interest rate risk, Caswell said.<\/p>\n
Majority of Americans are financially stressed from tariff turmoil<\/a>
This tax strategy is a ‘silver lining’ amid tariff volatility, advisor says<\/a>
Cash may feel safe when stocks slide, but it has risks<\/a><\/p>\n![\"73%](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/04\/108130372-5ED4-REQ-041025-Epperson-V2.jpg\")
Consider a ‘bond ladder’<\/p>\n