Get free help preparing your taxes from AARP Foundation Tax-Aide. Find a location



Celebrate Black Life, History, and Culture!
Rewards for Good Sweepstakes
Happy African American couple
Life at 50+ - Register for the Digital Experience
AARP Auto Buying Program

Jobs You Might Like



Stock Market Dip Is No Reason to Panic

Look for ways to diversify your retirement portfolio, instead of selling

"You need an adequate amount of equities to keep up with inflation in retirement," he says. "If you'll want to spend money — take a cruise, buy plane tickets to see your grandchildren — you will need growth. You shouldn't have a long-term strategy that is based on short-term events like yesterday's headlines."

Lee Rosenberg, president of American Investment Planners in Jericho, N.Y., offers a slightly different strategy. If you're cautious, consider swapping assets — for instance, selling equities that performed poorly in recent years — and buying into utilities, mutual funds comprised of dividend-paying blue chip companies or short-term bond funds. These investments tend to be less volatile.

For investors nearing retirement, with a portfolio that's divided equally among bonds and equities, for example, Rosenberg suggests moving 10 percent from stocks to bonds for added security.

"Moving into short-term bonds or mutual funds that are highly liquid … puts your money on the sidelines and out of harm's way for a period of time, say, one to three months," he says.

Building a retirement nest egg is tremendously important, but a steady stream of guaranteed income could make all the difference in achieving a comfortable, secure retirement.

To that end, Dan Keady, CFP, director of financial planning at TIAA-CREF, says that if your employer will let you convert your 401(k) into a fixed-income annuity, you should give it serious thought. Having a portion of your investments in a fixed annuity can provide some protection in this investment climate.

"It's not just having a nest egg, it's having a steady income stream," Keady says. "Let's make sure that individuals nearing retirement don't have their own fiscal cliff."

Consult your financial adviser for advice regarding your personal situation.

Carole Fleck is a senior editor at AARP Media.

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts


Please wait...

progress bar, please wait

Tell Us WhatYou Think

Please leave your comment below.

Jobs You Might Like

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

UPS Store membership discount aarp benefits

Members save 15% on eligible products/services, 5% on UPS shipping at The UPS Store®.

membership adt

Small business owners save 20% on new installation of any new ADT security system.

membership consumer cellular

Members save on monthly service & usage fees and get free activation with Consumer Cellular.

Member Benefits

Renew today! Members receive exclusive member benefits & affect social change.

Rewards for Good

Your Points Balance:

Learn More

Earn points for completing free online activities designed to enrich your life.

Find more ways to earn points

Redeem your points to save on merchandise, travel, and more.

Find more ways to redeem points

Advance your skills. Transform your career.

Explore your learning possibilities.