Costs rising, stocks plunging: advice from a financial expert

The stock market volatility has people on edge, especially people who are close to retirement.

Portfolios are plummeting as the stock market took the biggest dive since 2020 on Thursday, and markets continued to fall on Friday, closing a volatile week for people’s pocketbooks.

It’s happening as inflation is also hitting people hard, from gas to food princes.

“Everything keeps rising and it’s hard for us to survive,” said Tavion Washington, a dad of two who works in Renton.

The Dow dropped more than 1,000 points on Thursday while NASDAQ plunged 5 percent.

“The bad news, it’s pretty surreal,” said David Liu, who in the Renton Highlands on Friday.

The market fluctuations have people on edge.

“Honestly, it just feels like I can’t look at that right now,” said Stephanie Browne, also in the Renton Highlands on Friday. She said she heard the news on the radio and had to change the channel. “There are some things you can control and the day to day is what you can manage,” Browne said.

But for people close to retirement, managing your money now could be critical.

KIRO7 sat down with financial expert, John Carruthers, with Decker Retirement Planning.

“It’s painful, we worked hard for that money and we don’t want to see it drop,” Carruthers said. Carruthers is a senior financial planner with Decker.

He says step one — don’t panic.

“Try to avoid letting your emotions control what happens to your finances because that’s when most of us make mistakes,” he said.

He says the market volatility will hit people who are closest to retirement the hardest. But even people who are a few years away from retiring should be able to weather the storm.

“As long as you’re more than three to four years out from retirement, it’s best to just let it ride. Because this will only be a small blip on the radar when you look back,” Carruthers said.

However, if you’re about to retire immediately, Carruthers says it’s worth considering moving your money.

“Seeing if you can shift a little to quality and some of the more defensive assets to protect it for you,” he said. Carruthers says examples of more stable assets are commodities like precious metals or utilities like Puget Sound Energy.

He says in some cases, some people might need to re-think their retirement plans.

“If you’ll have to work a couple more years or just reduce your income a little,” he said. “It’s an unfortunate pill but hopefully most people won’t have do that. With some strategic moves they can avoid having to delay their retirement” Carruthers said.

Another tip that applies for everyone? Carruthers has a warning about bonds and is currently advising against investing in the traditionally stable option.

“When rate increases — bond prices drop. So I actually find them to be more risky than stocks are right now. I’d say avoid moving to bonds,” he said.

The good news, if you have more than 10 years before retiring, Carruthers says now is a great time to invest because stock options are essentially on sale.

“You look at some of the NASDAQ positions, you’re buying at about 60 percent off so,” he said. “It’s a great time to buy in and start buying things at a discount.”

Everyone’s financial situation is different and Carruthers says before making any substantial decisions with your money, you should check in with an expert.

RAW: Financial planner shares how to make the most out of rough times

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