Are You Taking Too Much Risk Before Retirement?

Last Monday on KTVU Mornings on 2, I discussed a critical question many people are not asking themselves:
Are you taking too much risk as you approach retirement?
If you’re within 10 years of retirement—or already retired—this conversation is especially important.
Many people are still investing the same way they did in their 30s and 40s. That may have worked during years of strong market growth, but today we’re seeing increased volatility, rising interest rates, persistent inflation, Iran war and global uncertainty.
As your timeline shortens, your margin for error does too.
If the market were to decline 30%, 40%, or even 50%, you may not have the luxury of waiting years for a full recovery like you did earlier in your career.

The Biggest Risks We See Before Retirement

Having Too Much Money in Stocks
When you’re younger, market downturns are part of the journey—you have decades to recover.
But as you enter your 50s and 60s, your focus should begin to shift from growth → protection and income.
History gives us important lessons. During the dot-com crash, the NASDAQ fell nearly 78% and took over a decade to recover.
Ask yourself:
👉 Can you afford to wait 10–15 years for your portfolio to recover if you’re about to retire?
For most people, the answer is no.

Focusing on Account Balance Instead of Income
One of the biggest mindset shifts in retirement planning is this:
👉 It’s not about how much you have—it’s about how much you can generate.
Many investors still think in terms of portfolio value, but in retirement, what matters most is:
● How will you create consistent income?
● What happens if markets are down when you need withdrawals?
● Are you withdrawing in a tax-efficient way?
Without a plan, volatility can force people into selling investments at the wrong time—locking in losses.

Ignoring Taxes in Retirement Planning
Market risk gets all the attention—but tax risk can be just as damaging, if not worse.
In retirement, you must consider:
● Taxation of Social Security
● Required Minimum Distributions (RMDs)
● Medicare premiums (IRMAA)
● Withdrawals from different account types

Lack of Proper Diversification
I see this constantly in the Bay Area.
You worked at a great company.
You built up stock through RSUs.
And it did really well.
So you held on.
Because:
● You didn’t want to pay taxes
● Or you believed it would keep going up
And for a while… it did.
Until it doesn’t.
We’ve seen companies like Peloton and Zoom drop dramatically after being at the top.
👉 The question is:
What happens to your retirement if that happens to you?

I’m Playing It Safe… So I Just Keep Cash
Then there’s the other side.
You’re tired of the market swings.
You don’t want to lose money.
So you keep a large amount sitting in the bank.
It feels safe.
But every time you go to the grocery store…
Every time you fill up your gas tank…
👉 You’re reminded:
Prices are going up faster than your money is growing.
That’s the risk people don’t see

The Bottom Line

As you approach retirement, your strategy must evolve.
It’s no longer just about:
● Growing your portfolio
It’s about:
● Protecting what you’ve built
● Creating reliable income
● Managing taxes
● Reducing risk across multiple areas
👉 Market risk is real—but being unprepared for it is even more dangerous.

What Should You Do Next?

If you’re within 5–10 years of retirement—or already retired—it’s time to ask:
● Is my portfolio aligned with my timeline?
● Do I have a clear income strategy?
● Am I managing taxes proactively?
If you’re not sure, that’s exactly where we can help.
👉 Schedule your Retirement & Tax Readiness Check-In to identify potential gaps in your
plan.
And you can catch me every Monday morning on KTVU Mornings on 2, where we break down what matters most for your financial future.