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Section 2
Investment Losses
We’ve discussed the fact that it’s probably going to be necessary
for you to make investments that can provide growth to have
enough money in retirement. An unfortunate reality of investing
for growth is that, on a fairly regular basis, the stock market
experiences sudden downturns or crashes. The greatest one
we’ve ever experienced was, of course, the instigator of the Great
Depression. These extreme bear markets affect everybody, and,
generally, the only action to take is to ride it out.
A prolonged market downturn can, however, do serious
damage to an investment portfolio. This may affect a retiree’s
ability to sustain income over the course of a 20-, 30-, or 40-year
retirement. As we discussed earlier in the book, stock market
declines are a predictable part of investing in stocks.
Chapter 5: Things That Can Wreck Your Retirement
