12 Smart Strategies To Help Protect Your Retirement Savings From Future Market Volatility

INVESTING - SAVING FOR RETIREMENT
Secure your financial future with these 12 smart strategies.
Updated Feb. 21, 2024
Fact checked
businessman wearing suit hugging briefcase full of money over orange background

We receive compensation from the products and services mentioned in this story, but the opinions are the author's own. Compensation may impact where offers appear. We have not included all available products or offers. Learn more about how we make money and our editorial policies.

Investment accounts are among the best ways to plan for retirement. Not only do they help you save money, but they also generate returns, which means you can grow your wealth without too much time and effort on your part.

However, the whims of the market can determine how successful your investments are, which means massive market downturns (such as the 2008 recession) can take a major toll on your retirement savings.

Here are the 12 best ways to make sure you’ll have the money you need to retire comfortably.

Eliminate your late tax debt

Each year, the IRS forgives millions in unpaid taxes. If you have more than $10,000 in tax debt, or have 3+ years of unfiled taxes, you could get forgiveness too. You might be eligible to lower the amount you owe, or eliminate your tax debt completely.

Easy Tax Relief could help you lower or get out of your tax debt for good. They’re well respected in the industry and have been recognized for their ethical standards when dealing with tax debt. While most tax companies just put you on a payment plan and file your taxes for you, Easy Tax Relief talks to the IRS directly. They can help you pay off your tax debt faster while potentially reducing what you owe.

Important: Not everyone will qualify. To take advantage of this special program you must owe more than $10,000 in past-due taxes.

Fill out this form to get started

Consider dividend-yielding stocks

Iona/Adobe attractive business woman smiling while standing outdoor flaunting dollars in hand

Although companies might cut dividend payments during an economic downturn, you can hypothetically rely (at least in part) on the passive income you gain from dividend-yielding stocks while you wait for the rest of your investments to bounce back.


Diversify, diversify, diversify

Blue Planet Studio/Adobe man wearing suit holding graphs showing concept of digital financing

If there’s a golden rule of investing, it’s this: You need a diversified portfolio. If you put all your investment eggs in one basket (meaning one type of investment or one sector of the economy), you could lose your profits quickly if that investment or sector runs into trouble.

But with a diversified portfolio, you’ll have a variety of investments with different levels of risk, including bonds, domestic and international stocks, long-term and short-term investments, and real estate funds. 

Even if one sector of the economy collapses, your investments in other sectors could help you maintain profitability and outlast market fluctuations.

Work with a financial advisor

mavoimages/Adobe african american couple taking advice from female finance advisor

If you’re worrying about the state of your savings (or even if you aren’t), it’s a good idea to meet with a retirement planner or financial advisor. 

For one thing, it’s easy to be scared of things you don’t understand — so talking to someone who understands the market can put your mind at ease.

For another, a financial advisor can determine if you’re making the best investment choices for your age and financial goals, then help you adjust your portfolio accordingly.

Earn $200 cash rewards bonus with this incredible card

There's a credit card that's making waves with its amazing bonus and benefits. The Wells Fargo Active Cash® Card(Rates and fees) has no annual fee and you can earn $200 after spending $500 in purchases in the first 3 months.

The Active Cash Card puts cash back into your wallet. Cardholders can earn unlimited 2% cash rewards on purchases — easy! That's one of the best cash rewards options available.

This card also offers an intro APR of 0% for 15 months from account opening on purchases and qualifying balance transfers (then 20.24%, 25.24%, or 29.99% Variable). Which is great for someone who wants a break from high interest rates, while still earning rewards.

The best part? There's no annual fee.

Click here to apply now.

Don’t take a lot of risks when the economy is unstable

Lauren Kaylor/peopleimages.com/Adobe woman doing stock market research at night

There’s a time and a place for taking risks, and when the economy is in flux isn’t it. If you have a diversified portfolio, you won’t invest everything into the next disruptive idea, no matter how the economy is behaving.

But during a recession or a period of high inflation, it’s even more important to avoid dramatic, all-or-nothing investments.

Instead, focus on making stable investments with returns you can count on (for instance, investing in U.S. Treasury bonds).

Be smart about how much you withdraw

LIGHTFIELD STUDIOS/Adobe senior couple sitting at home as counting money

Common financial advice holds that you can withdraw 4% of your retirement savings in your first year of retirement, then continue to withdraw 4% each year while adjusting for inflation. However, 4% could be too high if the economy is in a tailspin.

You might want to withdraw closer to 3% or even lower, depending on what you can afford. Picking up a gig job, downsizing your home, and curtailing expenses can also help your retirement savings stretch further.

Reevaluate your investments once a year

dusanpetkovic1/Adobe businessman wearing suit and glasses sitting at office reviewing documents in hand

Your investment portfolio shouldn’t remain static until retirement. Instead, it needs to change with you, especially as you get closer to retirement. 

As a rule of thumb, you’ll want to check on your investments and rebalance them at least once a year.

Lock in today’s higher rates on government bonds

Thomas Perkins/Adobe cup with black coffee and pen placed over newspaper with bond yield charts

U.S. Treasury bonds are among the safest types of investments, and getting a return is practically guaranteed since they are backed by the full faith and credit of the U.S. 

Interest rates on Treasury bonds are near the highest they’ve been in over a decade due to the Federal Reserve hiking interest rates over the past year.

Make age-appropriate investments

Serhii/Adobe male broker looking at screen while reviewing stock graphs

When you’ve just started working, you can tolerate a higher level of risk. So if the market goes south, you should still have decades to rebuild your investment savings. 

But if you’re only a few years away from retiring, you probably won’t have time to regain money lost on a risky investment. A financial advisor can help you make age-appropriate investments that will pay off in time.

Work part-time to improve your cash flow

irissca/Adobe woman using pen to show papers in front of smartphone while vlogging at work

Whether you’re still part of the full-time workforce or have already retired, a side gig can give your budget an extra cushion to help you outlast any temporary market setbacks.

Plus, even if your investments are currently performing well, the income from a side gig can set your mind at ease and help you spend less time worrying about retirement.

A side gig could also fund a fun expense like a bucket-list vacation without requiring you to dip into your retirement funds during an economic downturn.

Take advantage of historically high rates to grow your wealth

Are your savings just sitting around, not earning much interest? It's time to make a change and put your money to work for you! With CloudBank 24/7, you can earn more interest on your money today ... while keeping your cash OUT of the stock market.

Here’s their secret: CloudBank 24/7 amplifies your money by doing what many banks refuse to do … paying you a rare 5.26% APY (annual percentage yield)12 on your cash.

When you deposit your money into this high-yield savings account, you can supercharge your emergency fund, short-term savings, return on cash, and more with interest income generated from their high 5.26% APY payout.

The best part? There are no fees, you can withdraw your money at any time, and opening an account takes as little as 3 minutes. CloudBank 24/7 is FDIC-insured through Third Coast Bank SSB and cybersecurity is a top priority, ensuring your data is kept safe.

Click here to open a CloudBank 24/7 online savings account

Avoid selling stocks that are down (when possible)

Jesse Bettencourt/peopleimages.com/Adobe businessman holding hands in terror while stressing about stock market charts

It’s tempting to pull your investments when the market is down — but if at all possible, try to resist the urge. 

Once you cash out, you’ve effectively locked in your loss by removing the opportunity to regain your profits once the market bounces back — which it inevitably will, though the exact length of time it takes to rebound is always unknown.

Keep the big picture in mind

Lauren Kaylor/peopleimages.com/Adobe female data analyst working late at night at office

Daily fluctuations in the stock market aren’t signs of a crisis. Instead, they’re an essential part of how the market functions. And like we said above, the market historically always rebounds from a crisis, given enough time.

If you’re worried about losing your investments, try to take a step back and see the big picture instead of focusing on daily, monthly, or even yearly changes.

Reassess your retirement age

Jelena Stanojkovic/Adobe senior man sitting in lounge on couch thinking about something serious

If you’re just a few years from your planned retirement when the economy starts to spiral, you might have to make some hard decisions about pushing back your retirement date. 

Part-time jobs and gig work can only bring in so much income compared to the amount you’re making at your current job after decades spent in the workforce.

Obviously, health issues, family plans, and unexpected emergencies can all impact whether you can push back retirement or not. But crises sometimes require drastic actions, so if possible, leave a later retirement on the table.

Bottom line

N Felix/peopleimages.com/Adobe happy asian female accountant sitting at office reviewing papers while using laptop

The stock market’s inherent volatility can take a toll on your retirement savings. 

However, generally speaking, you can recoup your potential losses with enough time and preparation — especially if you follow the 12 guidelines we listed above to protect your investments.

FinanceBuzz is not an investment advisor. This content is for informational purposes only, you should not construe any such information as legal, tax, investment, financial, or other advice.

Customers Bank High Yield Savings Account Benefits

  • Incredible 5.32% APY3 to boost your savings
  • Interest is compounded daily and posted to your account monthly
  • Enjoy 24/7 online access to your account and funds
  • FDIC insured, no fees, $1 minimum deposit

Author Details

Michelle Smith Michelle Smith has spent a decade writing for and about small businesses. She specializes in all things finance and has written for publications like G2 and SmallBizDaily. When she's not writing for work at her desk, you can usually find her writing for pleasure near large bodies of water.

Want to learn how to make an extra $200?

Get proven ways to earn extra cash from your phone, computer, & more with Extra.

You will receive emails from FinanceBuzz.com. Unsubscribe at any time. Privacy Policy

  • Vetted side hustles
  • Exclusive offers to save money daily
  • Expert tips to help manage and escape debt