Is Your Retirement Plan Bear Market Proof?

Transcript

Ken Fisher:

So, one of the standard questions that's often asked, and increasingly, at a time like November 2025, when increasingly, people have become concerned that there may be a big downturn ahead— and of course, usually I see those fears as a positive sign, not a negative sign, but that's a different topic—should investors fear a big downturn as they approach retirement?

And the answer to that is, what they really should fear is not having a good plan to last them for as long as their post-retirement need for their money exists, which is for most people, the rest of their life, the rest of their and their spouse's life, maybe leaving some money to the kids, or whatever it is. If you create that plan correctly, you've planned for what may be a bear market in the period ahead, which largely, to make a long story short, is setting aside enough cash in fairly liquid, nonvolatile assets so that you can get through a period of a few years where there might be a downturn without having to dip heavily into your principal.

If you can do that, the rest of what you got comfortably moves into the longer-term investment plan that you have, which includes future bull markets, bear markets and everything in between. It's really pretty simple, as per the title of one of my books once upon a time.

It's really about planning for your prosperity. If you plan for your prosperity, and you plan your prosperity correctly, the fact is, over long periods, you're going to have bear markets, you're not going to be able to predict them very precisely unless you know stuff I don't know, in which case you don't need to listen to me anyway—and oh, by the way, if you've planned for it all well, it'll work out well. Most of this—and the planning is not overly complex, I mean, the reality is, there's an ilk of folks that want to make financial planning way more complex, with way more granular detail than you really need. You need to get the broad brushes more or less correct, and if you do that, everything else largely falls into place. And then, of course, you have to not go and do crazy things that veer in your activities from what that plan is, your plan has to be reasonably consistent with your lifestyle and your future goals, etc. but that's the way you should think about it.

The reality is, retirement in a different way doesn't really change what you're about. While you're working in the many years pre-retirement, most folks are trying to accumulate assets such that they'll be sustainable when the post-retirement income becomes either diminished or is eliminated, tied to whatever it is that your retirement benefits are or are not from work. And then, from that, you build that plan and during your working years, there's bear markets— they didn't derail your life. If you plan for it correctly, there's going to be bear markets in the 10, 15, 20, 30 maybe years after your retirement, and they don't need to derail anything either.

Thank you for listening to me. Hi, this is Ken Fisher. Subscribe to the Fisher Investment YouTube channel. If you like what you've seen. Click the bell to be notified as soon as we publish new videos.