All good things must come to an end. That popular saying applies to most things in life, and the financial markets are no exception. One of the longest bull markets in history has been going strong for nearly a decade. Going back to March 2009, the S&P 500 has increased more than 320 percent. Although there have been some pullbacks along the way, the markets are nearing their 10th consecutive year of upward movement.1 At some point, though, the bull market will end and the market will correct. In fact, the end could be near. On Oct. 10, the Dow Jones Industrial Average (DJIA) dropped more than 800 points. The loss was based on a variety of fears and uncertainties, including rising interest rates, the impact of tariffs and corporate earning challenges.2 It’s impossible to predict market movement, especially in the short term. However, it’s always wise to plan ahead. This could be a good time to analyze your strategy and see if it still aligns with your long-term needs. There may be steps you can take to minimize your risk exposure and weather the potential downturn. Below are a few strategies to consider: Don’t make impulsive decisions. As you approach retirement or enter retirement, you may become more conservative in your attitude toward investing. After all, you’ve worked hard to accumulate your retirement assets. You may need to use those assets to generate income. You likely don’t want to see your balance decline because of a market downswing. However, it’s important to remember just how long your retirement may last. You could be retired for decades. You will still need growth to sustain your assets over that period. You also may need to increase your income over time to keep up with inflation and pay for health care expenses. If you make an impulsive decision to move into so-called safe assets, you may forgo opportunities for growth. Growth and risk often go hand in hand. Many of the investment vehicles that have no risk exposure also offer little growth potential. Before you make an emotional, impulsive decision, talk to your financial professional. They can help you review your strategy and goals and make adjustments. It’s possible that a slight shift in your allocation could give you more protection but still offer growth potential. Continue to contribute to your retirement accounts. If the market starts to correct, you may feel like you should stop putting money into your 401(k) and IRA. After all, why contribute money just to see the values decline? However, that may not be the wisest course of action. Nothing is permanent, including market corrections. When you contribute to your retirement accounts, you’re still buying shares of funds and other investments. If you make those contributions during a downturn, you’re actually buying shares at reduced prices. That could help you achieve more growth when the market recovers. Don’t abandon your savings strategy just because the market or the economy has changed. Continue to put money away for retirement and stick to your long-term plan. Explore tools to minimize your risk exposure. Finally, talk to your financial professional and explore tools that can protect your retirement income and minimize risk. For example, annuities can be effective risk management tools. You could use a single premium immediate annuity (SPIA) to convert a portion of your assets into an income stream that’s guaranteed* for life. Or you could use a fixed indexed annuity to potentially increase your assets on a tax-deferred basis with no exposure to market risk. You could opt for a fixed deferred annuity that offers guaranteed*, predictable interest rates. There are a variety of ways in which you can use an annuity to minimize risk and protect your retirement assets. A financial professional can help you determine if an annuity is right for your goals and needs. Ready to protect your retirement from market risk? Let’s talk about it. Contact us today at M&P Personal Financial Planning. We can help you analyze your needs and implement a strategy. Let’s connect soon and start the conversation. 1https://www.fool.com/investing/2018/08/29/were-in-the-longest-bull-market-in-history-what-sh.aspx 2https://www.cnbc.com/2018/10/10/why-this-market-selloff-isnt-like-the-correction-earlier-this-year.html *Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values. Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18155 - 2018/10/17
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