How to Safeguard Your Retirement Plans Against Market Volatility

The recent MetLife survey has shed light on the concerns of retirement plan sponsors regarding the ability of retirees and those nearing retirement to handle market volatility. With big swings in the stock market potentially hurting retirement savings, it is crucial for individuals to stay on track to meet their financial goals.

According to the survey, nearly 70% of defined contribution plan sponsors are worried about participants within 10 years or less from retirement, while 61% are concerned about those who are already retired. This highlights the importance of being prepared for market fluctuations.

Experts advise retirees to have a cushion of savings in cash, cash-equivalents, and short-term investments to avoid panic selling during market downturns. Having three to five years’ worth of living expenses in these safe assets can help weather the storm until the market recovers.

It is also recommended to periodically rebalance portfolios based on financial goals to ensure the right asset allocation. By staying informed and making strategic decisions, retirees can navigate market volatility with confidence and protect their retirement savings for the long term.