This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

3 Investment Essentials to Keep in Mind as Stocks Get Shaky Again

NEW YORK (TheStreet) -- In the past month or so the S&P 500 dropped about 50 points, leaving retirement investors wondering if their portfolios are perched in the right places.

"Many investors were lulled into a false sense of security as the market was slowly improving and staying steady in recent months," says Nicole Mayer, a financial planner with RPG-Life Transition Specialists. “Last week’s shifting stocks reminded all of us that the market is nothing if not uncertain. That is why it is absolutely crucial to make sure that your investments are in line with your financial goals.”

Basically, that means establishing long-term financial goals, working with a financial professional to lay out a blueprint. To set goals, you should be asking:

  • When do you want to retire?
  • How much do you need to retire?

Read More: 5 'Mindless' Money Mistakes You Don't Want To Make

  • How much risk you can assume and still be able to sleep at night without worrying about your retirement portfolio?

Once you've set goals, Mayer says there are three investing principles you should keep in mind to protect retirement savings:

There are no "one-size" approaches. Your financial adviser should make your portfolio according to your specific needs and goals and respecting the amount of risk you are prepared to take. That could mean absorbing more risk when you are young (as you have more time to recover from downward markets and sliding fund performance) and shifting portfolio assets when you’re older and nearing retirement into more conservative investments such as Treasury bills to preserve those assets and keep them out of harm’s way. 

Read More: What You're Paying For Financial Fees -- and How To Avoid Them

Watch for "general guidelines." Every armchair stock trader has a "sure thing" for you to buy in the stock market, but those "experts" don’t know your unique retirement needs and expectations. "You should set your own specific goals for your future and find out what you need to do to get there -- like how much you need to save and the return you need on your investments," Mayer says. After that, it’s all about balance and generating enough plan assets with as little investment risk as possible.

Use discretion. Job No. 1 with any retirement portfolio, in choppy markets or not, is to not lose money. Why? Because it’s not easy to regain plan money that leaves your retirement account. “If you lose 30% in your investments when the market tanks, it doesn’t matter how old you are. In order to make back the 30% you lost, you will need to earn 43% just to make back what you lost and get back to square one,” she says.

Mayer advises not to panic when markets melt away and to always know what stocks, bonds and funds make up your retirement plan and why they’re in the plan in the first place. Do that and you’ll be taking a big first step in protecting your financial future no matter what’s happening in the financial markets.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,827.75 +12.81 0.07%
S&P 500 2,072.83 +5.80 0.28%
NASDAQ 4,787.3170 +29.0650 0.61%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs