Here’s How Much Cash Retirees Need To Weather A Stock Market Downturn

Here's How Much Cash Retirees Need To Weather A Stock Market Downturn

Amid high inflation and rising interest rates, there are fears of a prolonged stock market downturn, and some retirees may be vulnerable without a cushion of cash, financial experts say.

However, there’s also the risk of crumbling purchasing power, with annual inflation growing by 8.5% in March, the U.S. Department of Labor reported.

Meanwhile, average savings account yields are still below 1% as of May 4, according to, making cash less attractive.

The right amount of cash depends on each retiree’s situation, said certified financial planner Brad Lineberger, president of Seaside Wealth Management in Carlsbad, California.

“There’s not a silver bullet or a magic answer,” he said.

Advisors may suggest keeping three months to six months of living expenses in cash during a client’s working years.

However, the number may shift higher as they transition to retirement, said Marisa Bradbury, a CFP and wealth advisor at Sigma Investment Counselors in Lake Mary, Florida.

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Source: CNBC

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