# Smart Moment #4
## Should Retirees Really "Stay the Course"?When the market drops sharply, should a retiree simply stay the course?** You've probably heard the expression many times. "Stay the course."
There is certainly wisdom behind it. Selling investments because you're frightened by a market decline can turn a temporary decline into a permanent loss.But I think there is another question worth asking: What exactly is the course? Your course should be based on your financial plan.
Suppose you're 45 years old, still working, contributing to your retirement accounts and don't expect to need your investments for another 20 years. Your ability to withstand market volatility may be quite different from someone who is 72, retired and withdrawing $60,000 a year.Both people might have the same investment portfolio. But they don't have the same financial circumstances. Sometimes staying the course means making adjustments.
For one person, staying the course might mean continuing to invest through a downturn.For another, it might mean maintaining sufficient reserves so they aren't forced to sell investments. For another, it might mean adjusting the portfolio as market conditions change.
That's where tactical allocation enters the conversation. At Benchmark Financial Design, we don't believe tactical management is about predicting every market move. It isn't. Instead, it is about recognizing that markets change and determining whether portfolio exposure should change with them. There will be times when tactical strategies lag a rising market. That's part of the trade-off.
Perhaps the better question is...Instead of asking: "Should I stay the course?" Ask: "Is the course I'm on still appropriate for my financial situation?"** That's a much better question.
· Your retirement date changes.
· Your income needs change.
· Your family circumstances change.
· And markets change.
Your financial plan should be reviewed as those things change.
A Smart Moment takeaway: "Stay the course" doesn't necessarily mean doing nothing. It means having a plan you understand, knowing why you're following it, and making thoughtful decisions when circumstances change. The worst time to decide what your investment strategy should be is often when you're watching your portfolio fall.
The time to make that decision is before the next difficult market arrives.
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