Personal Finance

How Retirement Rules Changed in 2016

Yields On Bonds
Yields On Bonds

Data sources: and

Data sources: and

It's worth noting, however, that over the same time frame, inflation has stayed very low as well. Back in 1990, it was as high as 5.4%. Since 2009, however, it has only surpassed 3% during one year (2011).

Still, the yields offered today aren't really enough to keep pace with inflation, and that means that if retirees want to be proactive, they need to keep more of their money in stocks. That's another reason that changing the equation to determine the right stocks-to-bonds ratio could be a savvy move on your part.

Selling on anticipation of turmoil

I have a family friend that decided this summer to sell his entire retirement portfolio and put it into cash. After the Brexit vote became final, he figured, there would simply be too much turmoil in the markets, and he saw them tanking in short order. He's not alone: The night after the U.S. presidential election, I had friends texting me saying that they were getting out of the market and were scared, as Dow futures were down almost 800 points.

It turned out to be a lot of worry about nothing. While the S&P 500 dipped 5.4% immediately following July's Brexit vote, the market is up over 3% since before the vote even occurred. And Trump's win? What was viewed as an overnight disaster for the markets turned into a record-breaking day for the Dow, as it hit an all-time high less than 24 hours later -- and has continued setting records.

The takeaway is clear: Don't let your emotions get the best of you. Remember that over the long run, the things that seem like life-or-death today will be funny stories to joke about in a few years. What really matters is being comfortable with how you're invested, putting in place a set-it-and-forget-it model that allows you to focus on the things that really matter in your daily life.

If 2016 taught us anything, taking such an approach is not only good for your nest egg, but for your emotional well-being as well.

The $15,834 Social Security bonus most retirees completely overlook

If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $15,834 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies. .

Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics


The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More