Should Retirees Sell Their Stocks With the Market Crashing?

When President Trump announced his tariff policies at the start of April, many financial experts braced for backlash. And the backlash came pretty much right away.

Stocks plunged following Trump’s big announcement. And while there’s been some back and forth in the market, all told, April has been an extremely volatile, trying month.

If you’re someone in your 30s or 40s, it can be disheartening to see the value of your portfolio take a massive dive. The good news, though, is that if you’re 20 or 30 years away from retirement, you have plenty of time to ride out this storm.

In fact, you really shouldn’t lose sleep over the state of your portfolio if you’re many years away from retirement. If you’ll be ending your career in 25 years, chances are, by the time you get to that point, you won’t even remember what April of 2025 looked like.

But it’s a different story if you’re retired already and are therefore relying on your portfolio for income. In that case, a down market could have a serious impact on your near-term finances.

But that doesn’t mean you should rush to dump your stocks. You may just want to take a closer look at your investments.

Is your portfolio’s asset allocation on point?

With the right asset allocation in your retirement portfolio, a down market doesn’t have to upend your finances immediately.

Say you have 50% of your portfolio in stocks and the remainder in bonds. With that setup, you may be well-equipped to sit tight and ride out a period of market volatility without having to make any moves. And you may find that the bond portion of your portfolio is producing enough income for you to manage just fine.

But if you’re more heavily invested in stocks, some changes may be in order. And even if not, you may want reassess your portfolio and see if more diversification is needed.

Another thing you may want to do is shift into stocks that provide you with ongoing income in the form of dividends. Dividends can help offset losses in your portfolio due to market turbulence.

It could pay to get a professional’s help

You may have made it all the way to retirement without seeking the help of a financial advisor. But if you’re worried about the impact a lousy market could have on your retirement income — both in the near term and the long term — then it’s a good idea to enlist a professional’s help.

A financial advisor can review your asset allocation and recommend changes as needed. They can also help you move into different assets if you feel you need to unload some risk.

Another valuable thing a financial advisor might do at a time like this is remind you not to unload your stocks completely, even though you may be inclined to do so out of panic.

It’s hard to see past market volatility when it’s having an impact. So it’s helpful to have someone who can serve as a sounding board.

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