When the Market Drops, Do... Nothing?

It’s been a rocky few weeks on Wall Street. Amid high tariffs and renewed recessionary concerns, the S&P 500 suffered its worst declines since the pandemic. If you’re retired or nearing retirement, seeing your portfolio in the red — even for a short period of time — can be particularly unsettling.

So what should you do about it? In short, nothing.

In investing, it’s generally wise to gently push back against the temptation to let emotions guide your decisions. While past performance is never a guarantee of future results, historically, many of the market’s best days arrive shortly after the worst. Pulling out now could mean locking in losses and missing a potential rebound.

But just because you’re doing “nothing” doesn’t mean there’s nothing you can do. Here are a few ideas you can think about implementing to protect your retirement in volatile times

Hold Cash Separately for Peace of Mind

Depending on your risk tolerance and the strategy you’ve discussed with a professional, it might be a good idea to keep a portion of your portfolio in cash for added flexibility and peace of mind.

Outside of your investment account, its generally worth setting aside money for emergencies an then building up an amount that can cover three to six months of expenses, according to T. Rowe Price.

Revisit Your Allocation

A well-crafted portfolio often revolves around balance. This could mean exploring a mix like 60% stocks and 40% bonds, or perhaps a 50/50 split, or even something tailored to your unique vision.

When shaping these ideas, it’s worth reflecting on risk and your broader portfolio strategy alongside a professional.

Everyone’s comfort with uncertainty is different, and a conversation with an expert can help you weigh how much risk you’re open to, how your investments align with your goals, and what kind of buffer—like cash or bonds—might fit into the picture.

Don’t Overthink Target-Date Funds

Still invested in a target-date fund from your working years? That’s not necessarily a bad thing. Many are built for glide paths that adjust over time. Some will even tactically rebalance based on market conditions.

💬 Advisor Insight

"A high-quality, diversified portfolio has rarely gone down and stayed down. The challenge isn’t volatility — it’s reacting to it emotionally. That’s where most retirement plans go off track."

— An advisor in the Money Pickle network

🥒 Pickle Tip

Labeling your cash account separately from investments may sound silly, but it helps. Seeing one slice of your savings holding steady during a downturn can ease anxiety — and reduce the urge to sell.

🌟 Final Thought

If you’re feeling nervous, you’re not alone. Just remember, long-term investing is about resilience, not reactivity. If these strategies feel overwhelming, consider chatting with Money Pickle’s network of financial advisors. We are here to help you, no matter what direction the market’s moving in.

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