3-Important Steps To Take Now To Protect Your Retirement Portfolio

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If you’re in your late 50’s to early 60’s you may look back at the steps that you take now, to protect your retirement portfolio, as some of the best moves you’ve ever made.

The markets have recovered since 2008 and most investors are ahead of where they were in 2007. Protecting those gains and not giving them back could make the difference between either a comfortable retirement on your terms or having to work a lot longer or counting pennies for the rest of your life. It’s that serious!

Follow these 3-steps and you’ll not only protect what you’ve worked so hard to accumulate, but you’ll begin to transition your portfolio to one that checks all the right boxes that you’ll need to retire.

Step # 1: Begin creating the income now that you’ll need in retirement!

Use some of your growth portfolios to set up a safe, stable, income-producing foundation for your portfolio.

For most people what you’ll be receiving from Social Security is not going to be enough. You’ll have a gap between what’s coming in and what you need to support your lifestyle. Now is a great time to reallocate a portion of your portfolio from growth into income. Not only will you reduce your portfolio’s risk but the income you have for retirement will be that much more powerful if you start now and not at the last minute.

Step # 2: Manage the balance of your growth portfolio for protected growth!

There is a difference between a 30-year-old’s growth portfolio and that of someone 5 to 10 years from retirement.

For a 30-year-old, experiencing a large loss is upsetting but they have 20 years to make it up. If you’re in your late 50’s to early 60’s you don’t have 20 years to come back. A big loss now will affect the quality of your life in retirement. Now is the time to manage your portfolio first to protect and then for growth. Ironically you may experience some of the best returns of your life. Not having to dig your portfolio out of huge holes like 2008 and 2001-02 can do wonders for your overall return.

Step # 3: Draw a line in the sand!

You have the power to protect your retirement.

You can decide right now what the maximum amount you are willing to lose is if the markets continue downward. This is not market timing. This is simply taking responsibility for your own future and not relying on the opinion of the next talking head appearing on CNBC. Decide now how much more of your portfolio you’re willing to risk and whether it’s 5%, 10%, or more, write that number down. If your portfolio goes down to that point get out. Getting back in is easy. Protect what you’ve worked 30 to 40 years to accumulate. You’re far better off to risk missing out on the next 5% up than participating in the next 40% down.

Now is the time to significantly reduce the risk in your retirement portfolio. If you’re in your late 50’s to early 60’s go back to the previous sentence and read it over and over again. You may look back at the decisions you make now to protect your retirement as some of the best you’ve ever made! If you need help call us. This is what we do.

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