Andrew Whalen is CEO & Founder of Whalen Financial.
Financial advisors often talk among themselves about something that rarely reaches the public. No, not the next hot stock or clever tax strategy, but something much more fundamental: the market cycle you retire into.
The market doesn’t owe you a retirement. In fact, despite having no will of its own, it can appear at times to be doing everything it can to work against you. The cycle can be kind, lifting portfolios and padding confidence, or cruel, delivering years of flat or negative returns just when you need stability most—timing that can dictate whether a retirement plan feels effortless or impossible. That reality sets the stage for a deeper look at how markets actually move across decades.
Timing Matters
Over more than a century, U.S. markets have moved in long, secular cycles. Bull markets can run for decades, compounding wealth at strong rates of return, while bear markets—sometimes just as long—deliver flat or negative returns. If you zoom out, the overall trend is up. But when you zoom in to a human life, timing matters more than most investors realize.
Examples abound: The S&P 500 delivered negative total returns from 2000 to 2009, but nearly tripled from 2010 to 2019; the 1970s brought stagnation and high inflation; the 1980s and 1990s saw a historic bull market; and the 2020 pandemic-driven bear market was followed by a swift rebound. Each period shows how dramatically the starting point can shape results.
Advisors call this vulnerability “sequence-of-returns risk.” Retire into a bad market cycle, and early withdrawals dig a hole that even a later bull market can’t fill. Two retirees with identical average returns can end up with vastly different outcomes simply because of when they retired. This is why advisors obsess over sequence risk and why it rarely shows up in public conversation—it’s not a headline-friendly message. But it’s real, and ignoring it is the biggest gamble most retirees don’t realize they’re making. That reality helps explain why so many individuals, left on their own, struggle to navigate it.
Here’s the truth: Most investors aren’t wired for this. A vivid example came in 2008, when many investors sold near the bottom of the financial crisis, locking in losses and missing much of the recovery that followed. Without a framework, they chase performance, pull back in fear at the worst possible moments, and stick to rigid withdrawal rules that don’t bend when markets demand flexibility. Advisors know these traps. We’ve seen them play out through cycles again and again. This pattern underscores a hard truth: Market behavior is unpredictable, but your retirement doesn’t have to be.
4 Ways To Protect Your Lifestyle
If you can’t choose your market, you need a plan that doesn’t rely on luck. That means putting structures in place that protect your lifestyle no matter what the market delivers—whether it’s a grinding bear cycle, a flat decade or a roaring bull run.
1. Secure A Floor
Cover essentials with guaranteed or stable income: Social Security, pensions, annuities or bond ladders. For example, delaying Social Security can increase guaranteed income and reduce pressure on investments during down years.
2. Rebalance And Diversify Consistently
Sell what’s appreciated, buy what’s lagged, and spread risk across asset classes to avoid behavioral mistakes. A disciplined annual rebalance helps prevent portfolios from drifting too heavily into overvalued assets.
3. Adjust Spending Dynamically
Change withdrawals as market conditions shift rather than clinging to a static rule. A practical method is using “guardrails” that allow higher spending after strong years and require slight cutbacks after poor ones.
4. Design Portfolio Glide Paths
Start conservatively and gradually increase equity exposure to reduce early-retirement shocks. For instance, a retiree might begin with 40% in stocks and move toward 60% over the first decade.
Control Your Strategy
The market doesn’t owe anyone a retirement. You cannot choose the cycle you inherit, but you can choose to build a resilient strategy. By securing a floor of reliable income, adjusting spending, rebalancing consistently, and thoughtfully structuring your portfolio, you give yourself the best chance to thrive regardless of market conditions. You can’t control the cycle, but you can control your strategy.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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