How Important Is It to Anticipate Potential Market Risks in Your Retirement Plans?

Retirement planning is about more than projecting your savings and picking an age to stop working. The real challenge is this: your financial life will unfold alongside unpredictable markets and other kinds of unknowable unknowns. From recessions to sudden crashes, history shows that market downturns are inevitable — and preparing for them can make the difference between confidence and anxiety in retirement.

At Boldin, we believe market risk isn’t something to fear, but something to plan for. By anticipating downturns, you can build resilience into your retirement plan and keep your long-term goals on track.

Planning for Market Risks Matters

If you’re already retired or nearing retirement, a sharp downturn can feel devastating. Losses early in retirement — when you’re beginning to draw down savings — are especially dangerous, a concept known as sequence of returns risk.

Planning for market risk means:

Stress testing your plan. Running “what-if” scenarios for downturns to see how how resilient your finances are.

Diversifying investments. Different asset classes respond differently to market shocks.

Building cash buffers. Having 1–3 years of spending in cash or short-term bonds can protect you from selling investments in a downturn.

Staying flexible. Adjusting spending or withdrawals during bad markets can extend your financial security.

Maintaining Flexible Buckets of Funding. Beyond investments, resources like home equity, annuities, or part-time income can serve as backup buckets during downturns.

Will the markets fall? What are the different kinds of crashes? What is the history of the markets?

Will the markets fall again? What kinds of downturns should you expect? And what does history teach us?

Planning for a market downturn isn’t about predicting the exact timing of the next crash — it’s about preparing for something that’s highly likely to happen at some point in your retirement. By anticipating volatility, you give yourself the flexibility to adapt and the confidence to stay on course, no matter the headlines.

While markets have risen more often than they’ve fallen, the downturns leave the deepest marks — and recoveries, though reliable, are often forgotten. That’s why it’s worth understanding both the history of major crashes over the past 50 years and the important differences between crashes, corrections, and bear markets.

Introducing Boldin’s Market Risk Explorer

Boldin’s new Market Risk Explorer, part of the Boldin Planner, lets you simulate tough scenarios, like a decade of poor returns, and see exactly how they could affect your Retirement Chance of Success and projected savings. By testing these possibilities in advance, you can prepare with confidence and build flexibility into your plan — so market challenges don’t derail your future.

With the Market Risk Explorer, you can test how your plan holds up under different downturns:

A Decade of Poor Returns
Simulates 10 years of weak growth (just 1% annually), similar to the sluggish early 2000s, to show how long stretches of underperformance affect your savings.

Three Bad Years in a Row
Models three consecutive years of losses starting at –15%, highlighting the risk of retiring into a downturn when withdrawals make losses sting more.

Custom Downturns
Set your own timing, duration, and severity — like a five-year slump with a 20% drop — to see how your plan might perform under specific scenarios you’re worried about.

If you aren’t comfortable with the results of your explorations, explore strategies to mitigate your risks.

Don’t Forget to Plan for Other Risks to Your Retirement Plan

Markets aren’t the only source of risk. Retirement spans decades, and your plan needs to account for other uncertainties as well:

• Longevity Risk: Living longer than expected means your money needs to last longer.
• Inflation Risk: Rising costs can quietly erode purchasing power over time.
• Healthcare & Long-Term Care Costs: Medical expenses often rise in retirement and can outpace inflation.
• Tax Policy Changes: Shifts in tax law can affect your retirement income strategy.
• Lifestyle & Family Needs: Helping kids, caring for aging parents, or simply wanting to spend more in early retirement years can strain resources.

A resilient plan looks at all of these risks together — not just the markets.

Keep Savings in Perspective: It’s Just One Lever Among Many

When people think of retirement planning, they often focus solely on savings. But savings are just one lever in a much bigger system. Boldin helps you explore how different levers interact:

• Spending: Even small adjustments in annual spending can extend the life of your savings dramatically.
• Work & Income: Part-time work or delaying retirement by a year or two can have a significant impact.
• Taxes: Smart moves like Roth conversions or tax-efficient withdrawals can free up thousands over time.
• Investments: Asset allocation decisions can balance growth and protection.
• Lifestyle Choices: Downsizing a home, relocating, or adjusting travel plans can unlock hidden flexibility.

Savings are important — but your retirement security depends on the combination of all these levers working together. That’s where planning comes in.

How Boldin Helps You Prepare

The Boldin Planner lets you anticipate risks, not ignore them. With Monte Carlo analysis, scenario testing, future projections, and the NEW Market Risk Explorer, you can see how your plan holds up in downturns like those in 1973, 2008, or 2020. And you can layer in other risks like longevity, inflation, and healthcare costs.

Because retirement isn’t a straight line, Boldin helps you:

• Explore “what-if” scenarios like a 20% market drop.
• Test different withdrawal strategies for resilience.
• See how adjustments in spending, work, or saving can offset risk.

By anticipating challenges, you give yourself freedom — freedom to enjoy retirement without constant worry about the next headline.

The Bottom Line

Market downturns will happen. History guarantees it. But with a plan that accounts for uncertainty — market risk, inflation, longevity, taxes, and more — you don’t have to let them derail your future.

Anticipating risk isn’t about being pessimistic. It’s about building confidence, resilience, and peace of mind. With Boldin, you can prepare for the unexpected and move forward boldly into retirement.