The events over the last few weeks remind us that no one can predict the ups and downs of the stock market. While there’s abundant information out there to reference so you can make informed decisions, there’s also a lot of conflicting advice. Some argue for “timing the market,” but there is simply no way to foresee all the periods of market volatility that may occur throughout your retirement. Sometimes market drops – like the coronavirus correction – are tied to unpredictable events like epidemics and natural disasters. No one could have foreseen the outbreak of this disease, and there’s still much uncertainty as to how far it will spread. However, it is possible to take steps to help protect yourself from market volatility ahead of time.

Markets continue to rise and fall as the coronavirus spreads around the world and as the government responds. Last week, the benchmark U.S. Treasury note fell to below 1%, which is a record low. After several record-breaking drops, the Dow surged 1,173 points in one day after Congress agreed on an emergency spending bill to help fight the coronavirus. The Federal Reserve responded to market panic by cutting interest rates half a percent in hopes of avoiding a recession.

Significant market drops and sharp jolts can be worrisome: The state of the market at the time of your retirement is not within your control. Even if you’ve saved diligently throughout your whole working life, a market downturn around the time of your retirement could potentially have a long-term negative impact on your wealth.

This is why it’s important to consider your risk tolerance before you retire. If you felt your heart rate increase with news of recent significant market drops, then you may want to rethink your risk tolerance and retirement plan. As you find yourself at, near, or in retirement, you’ll want to know how much retirement income you’ll need and where it will come from.

Ultimately, you may want to consider how to help protect what you’ve earned and try to avoid letting emotions impact your financial decisions. Diversifying your investments, maintaining an appropriate mix of stock and bonds based on your age and risk tolerance, and having a long-term financial plan can help you feel more secure and prepared during times of market volatility.

There’s no single right approach to retirement planning in a volatile market. We can work together to help you make smart financial decisions based on your unique situation and to help prepare your retirement plan for whatever the stock market brings.