Retiring While the Stock Market’s Crazy

By [Steven Orlowski, CFP, CNPR

Retiring is a major life transition, and doing it during a wild, unpredictable stock market can feel like jumping out of a plane with a parachute you haven’t tested. Market volatility can be nerve-wracking, especially when you've spent decades building a nest egg. But here’s the truth: people retire in every kind of market—bulls, bears, and everything in between.

If you're staring down retirement and the market looks like a rollercoaster, don’t panic. You don’t have to put your dreams on hold. With a few smart strategies and a steady hand, it’s still possible to retire confidently—even while the market’s acting up.

1. Shift From Growth to Income

One of the first things you’ll want to review is how your portfolio is allocated. If you’re still heavily invested in aggressive growth stocks, now’s a good time to start shifting toward a more balanced mix of assets—think dividend-paying stocks, bonds, or annuities.

This doesn’t mean abandoning stocks altogether. Equities still play an important role in protecting your purchasing power from inflation. But as you move from accumulation to distribution, stability and income should take center stage.

2. Build a Cash Cushion

Think of this as your financial shock absorber. A good rule of thumb is to have 12 to 24 months' worth of living expenses in cash or short-term instruments like high-yield savings accounts, CDs, or money market funds.

This buffer gives you the flexibility to avoid selling investments at a loss during down markets. When the market dips, you can rely on your cash cushion instead of drawing from your retirement portfolio.

3. Sequence of Returns Matters—A Lot

One of the most underappreciated risks in retirement is what financial planners call the “sequence of returns” risk. Put simply, it means that the order in which you experience investment returns early in retirement can significantly impact how long your money lasts.

To protect yourself, consider a “bucket strategy” or a similar approach that separates your assets into short-, medium-, and long-term buckets. This allows you to draw income from safer assets while giving your riskier investments time to recover.

4. Don’t Make Panic Moves

Watching the market tumble and feeling your portfolio shrink can make anyone nervous. But the worst thing you can do is react emotionally. History has shown that markets recover—and often sharply. If you lock in losses by selling low, you risk missing the rebound.

Instead of trying to time the market, focus on what you can control: your spending, your withdrawal strategy, and your long-term goals.

5. Consider Working Part-Time (If You Want To)

If the numbers feel tight or you just want to ease into retirement, part-time work can be a great bridge. Even modest earnings can reduce the pressure on your portfolio and allow more of your assets to grow or recover.

Plus, many retirees find that part-time work brings a sense of purpose and structure—an underrated bonus.

6. Talk to a Pro

Retiring in a volatile market is a great reason to consult a financial planner or advisor. A good one can run stress tests on your retirement plan, help you identify the best withdrawal strategy, and give you peace of mind that you're on solid ground—even if the market isn't.

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Bottom Line

The stock market doesn’t have to dictate when—or how—you retire. With thoughtful planning and a flexible mindset, it’s entirely possible to enjoy a secure and fulfilling retirement, even in turbulent times.

Remember, retirement isn’t a one-time event. It’s a journey. And just like any journey, the key is to stay the course, keep your eyes on the horizon, and don’t let a few bumps in the road throw you off track.