Say the market drops, and you look at your balance and it’s lower. “That’s going to happen,” says Will Branch, investment analyst for MillenniuM Investment & Retirement Advisors in Charlotte, North Carolina. If the mere thought makes you feel ill, imagine it really happening.
You might need to take some risk off the table. Branch recommends this rule of thumb to make your allocation more comfortable: Whatever your age is, take that number and use it as a percentage of your total holdings for safer, fixed-income investments like bonds.