Am I Okay to Retire During Times of Fear and Uncertainty? 

Retirement is one of the biggest transitions in life, and it’s natural to feel uncertain— especially when the economy feels unstable. After spending decades saving and investing,  the last thing you want is to see your portfolio shrink just as you begin to rely on it. You  might be asking yourself: Am I making the right decision? What if the market drops further?  Should I delay retirement? 

These concerns are valid. Market volatility, rising inflation, and political uncertainty can  create fear, making it difficult to feel confident about your financial future. However, history  shows that while downturns happen, the stock market has always recovered and grown  over the long term. This is why risk management is just as important as investment growth  when planning for retirement—it helps protect your portfolio from the unexpected while  allowing for steady gains. Let’s take a look at ten past market corrections and what they  can teach us about retiring during uncertain times. 

10 Market Corrections That Tested Retirees 

While major crashes dominate the headlines, most market downturns are less severe but  still nerve-wracking for retirees. Here are ten times the market dropped more than  normal—but recovered: 

1. The 1962 Market Correction 

• Date: May 1962 

• Drop: 27% 

• Political Context: President John F. Kennedy (Democrat) 

• Economic Impact: Inflation fears and declining corporate profits created  uncertainty. 

• Takeaway for Retirees: The market rebounded within a year, showing how temporary  corrections can be. Those who stayed invested saw their portfolios recover quickly,  reinforcing the importance of long-term perspective in retirement planning.

2. The 1966 Bear Market 

• Date: 1966 

• Drop: 22% 

• Political Context: President Lyndon B. Johnson (Democrat) 

• Economic Impact: Rising interest rates and economic slowdown led to investor  concerns. 

• Takeaway for Retirees: A brief decline was followed by a multi-year bull market.  Retirees who maintained a balanced portfolio and didn’t react emotionally were  well-positioned to benefit from the recovery. 

3. The 1978-1980 Market Correction 

• Date: 1978-1980 

• Drop: 19% 

• Political Context: President Jimmy Carter (Democrat) 

• Economic Impact: Stagflation and rising oil prices put pressure on the market. 

• Takeaway for Retirees: Market volatility eventually led to a strong bull market in the  1980s. Retirees who had diversified income sources and cash reserves were able to  navigate the uncertainty without selling assets at a loss. 

4. Black Monday (1987) 

• Date: October 1987 

• Drop: 22% (in one day) 

• Political Context: President Ronald Reagan (Republican) 

• Economic Impact: Automated trading and speculative behavior led to the sharpest  single-day drop in history. 

• Takeaway for Retirees: Although dramatic, the market rebounded within months and  continued a long bull run. Retirees who avoided panic-selling and stuck to their plan  saw their portfolios recover swiftly.

5. The 1990 Gulf War Recession 

• Date: 1990 

• Drop: 20% 

• Political Context: President George H.W. Bush (Republican) 

• Economic Impact: Oil price spikes and economic slowdown triggered a short  recession. 

• Takeaway for Retirees: The recession lasted eight months, but markets recovered  strongly. Having a diversified portfolio with conservative assets helped retirees  weather the downturn without major financial distress. 

6. The 1998 Asian Financial Crisis 

• Date: 1998 

• Drop: 19% 

• Political Context: President Bill Clinton (Democrat) 

• Economic Impact: Global economic turmoil and investor panic led to a temporary  selloff. 

• Takeaway for Retirees: Recovery was swift, and markets surged into the 2000s.  Those who remained invested saw strong long-term gains, while those who  panicked and sold missed out on the rapid rebound. 

7. The 2011 European Debt Crisis 

• Date: August 2011 

• Drop: 21% 

• Political Context: President Barack Obama (Democrat) 

• Economic Impact: European sovereign debt issues and a U.S. credit downgrade led  to fear-driven selling. 

• Takeaway for Retirees: The market stabilized within a year, continuing long-term  growth. A well-structured retirement plan with steady withdrawals and diversified  investments ensured financial security.

8. The 2015-2016 Market Pullback 

• Date: 2015-2016 

• Drop: 19% 

• Political Context: President Barack Obama (Democrat) 

• Economic Impact: China’s economic slowdown and oil price collapse created  uncertainty. 

• Takeaway for Retirees: A quick rebound followed as economic conditions improved.  This period reinforced the importance of staying invested and having a strategy that  accounts for short-term volatility. 

9. The 2018 Fed Rate Hike Correction 

• Date: December 2018 

• Drop: 20% 

• Political Context: President Donald Trump (Republican) 

• Economic Impact: Federal Reserve interest rate hikes caused investor concern. 

• Takeaway for Retirees: A brief downturn was followed by a strong recovery in 2019.  Retirees who maintained a balanced portfolio with income-producing assets saw  stability even during uncertainty. 

10. The 2022 Bear Market 

• Date: 2022 

• Drop: 25% 

• Political Context: President Joe Biden (Democrat) 

• Economic Impact: Inflation, interest rate hikes, and economic slowdown  contributed to volatility. 

• Takeaway for Retirees: Despite ongoing market fluctuations, historical trends  suggest stabilization over time. Those with strong risk management strategies and  diversified assets fared better.

11. The Trade War Market Drawback 

• Date: 2025 (current) 

• Drop: Periodic declines up to 20% 

• Political Context: Presidents Donald Trump (Republican) and Joe Biden (Democrat) 

• Economic Impact: Tariff disputes between the U.S. and China have led to  uncertainty in global trade, supply chain disruptions, and market volatility. Investors  have responded with caution, leading to periodic downturns, particularly in sectors  heavily reliant on international trade. 

• Takeaway for Retirees: Trade tensions create short-term volatility but rarely change  the long-term growth trajectory of the market. Retirees who maintain a diversified  portfolio and focus on income-producing investments are better equipped to handle  fluctuations caused by geopolitical events. 

The Bigger Picture: Markets Grow Over Time 

While market corrections happen frequently, history shows that the stock market has  always recovered and continued to grow. Regardless of who is in office or what economic  conditions exist, the S&P 500 has trended upward over the decades.

This chart highlights an important truth: regardless of political party, economic concerns,  or global events, the market has consistently trended upward over time. While fear and  uncertainty are natural, history has shown that markets reward patience and long-term  investing. Investors who stayed the course during periods of volatility, rather than reacting  emotionally, have historically benefited from compounding growth and steady market  appreciation. Retirees who stayed invested during past downturns have historically  benefited from long-term market gains. 

A Real Advisor Observation – The people who react the most emotional to uncertain  times are the ones who usually lack a sound financial plan. 

How to Navigate Market Fear in Retirement 

1. Prioritize Risk Management – Managing risk is just as crucial as achieving returns in  retirement. A well-balanced strategy can help ensure you don’t have to sell assets at  a loss during downturns while still allowing for long-term growth. If you’re concerned  about retiring during uncertain times, here are four key strategies to protect your  financial future: 

2. Diversify Your Portfolio – A mix of stocks, bonds, and cash helps stabilize your  portfolio.

3. Maintain a Cash Reserve – Keep 6-12 months of expenses in cash to avoid selling  assets at a loss. 

4. Stick to Your Long-Term Plan – Market downturns are temporary; don’t make  emotional decisions. 

5. Consider a Glide Path Strategy – Shift gradually from stocks to bonds to reduce risk  while ensuring growth. 

How a Financial Advisor Can Help You Navigate Fear

‍A financial advisor can provide guidance and reassurance during uncertain times by: 

• Helping you create a retirement income strategy that accounts for market  fluctuations. 

• Advising on asset allocation to balance growth and security. 

• Offering historical insights to prevent panic-driven decisions. 

Rather than making reactive choices, a trusted advisor helps keep your financial plan on  track. 

Conclusion: Will You Be Okay to Retire? 

Yes, you can retire during uncertain times—history shows that markets recover, and with  the right financial strategies, you can navigate volatility confidently. The key is to stay  disciplined, focus on long-term growth, and seek professional guidance when needed. 

Retirement is meant to be enjoyed, not feared. By preparing for market downturns and  staying invested, you can achieve financial confidence regardless of economic conditions. 

Intermountain Wealth Management is a Registered Investment Adviser (RIA). The company manages several  fee-based portfolios comprised of various equity and fixed-income investments that may include mutual  funds and exchange traded funds. This is not a prospectus or an offer to sell any security. Please read the  prospectus of any investment before you invest. Information included here is intended for education and  information purposes only.