We often hear people say that they are good as long as things just keep on moving up and to the right. If only that were the reality.
Of course, if given long enough, that’s what happens. The key part of that statement is “if given long enough.” Recessions happen. When you are accumulating wealth, recessions can be helpful, but in retirement they are not. Recessions generally highlight and bring about the realities of downside risk.
The word “risk” can sound a lot scarier in retirement, especially when you’re switching from getting a dependable paycheck at work to needing to use assets you’ve saved over many years. At that point, it’s time to break down the different types of risk and determine how they apply to your financial situation, investments and goals in retirement.