Retirement in an Economic Downturn

The Bloomberg article on Monday, August 24th leads with the line: “Panic. Judgment Day. Carnage. Meltdown. Fearful. Depressing. Psychologically Draining. Wired.” These are words money managers used as they tried to process the effects of the current market downturn. I had a client meeting the same afternoon. Reading the headlines and the words used to describe investor fear, you would expect the mood of this meeting to reflect that.

“Upbeat. Excited. Anticipation. Calm.” These are the words that I would use to describe my meeting.

This meeting was special because the husband is retiring in three weeks. It is likely the last time I will see this couple before they both are officially retired.

Wait, a meeting finalizing a retirement during such dire market conditions and those are the words used to describe it?


We had a plan for how my clients were going to retire, regardless of what the market was doing. In fact, we planned for exactly this scenario; what would happen when the market fell. It’s simply coincidence that the market fall is corresponding with my client’s retirement.

How Some Retirees Get Through “The Best Years” in the Worst of Times

Here are the reasons my clients have confidence as we go through these rough market days:

They have perspective

We did talk about the market downturn, but my clients recalled the lessons they learned in 2008 and the years prior to that. They discussed how their experiences have given them perspective on what they hear and see in the news now.

They have a plan

This couple knew what they wanted their future to look like and took steps to plan for it. We have been working together for several years and this is simply an extension of the plan we created for them to retire. We considered their social security, their strategy to take money out of their investments and what retirement would realistically look like for them.

But this didn’t all just happen recently. My clients have been saving diligently with their 401(k)s for most of their careers. They paid off their house and continually made saving a priority.

They control what they can

My clients had calculated how much they needed to maintain their lifestyle in retirement. To that end, they monitor their spending by tracking their monthly expenses. They know the potential costs of long term care and other liabilities and they’ve insured for them. They are aware of the uncertainties that come with retirement, but they’ve done what they could to prepare.

Don’t get me wrong. Market downturns are a big deal. They are unnerving at best and it’s important to pay attention to them. But planning is even more important. Planning for retirement is what separates the panic, carnage and meltdown from the joy, peace of mind and excitement of retiring on your terms and your timeline. When you take control of your finances you won’t need to worry about market upsets having control over you.