The "Fix the Worry" Move That Can Quietly Backfire

One of the most common moves I see in pre-retirement planning is also one of the most understandable. Markets have been volatile. The headlines are alarming. Retirement is three or four years away. So a client gradually shifts their 401(k) and IRA toward what feels safe — heavy cash, very conservative funds, minimal exposure to anything that swings.

On the surface, it makes complete sense. Less volatility, fewer frightening weeks, a sense of control over something that otherwise feels uncertain.

But here's the problem. A portfolio that feels safe today can quietly lose the one thing a long retirement actually requires: the ability to keep pace with inflation over time.

I call this the "fix the worry" move. The intention is to reduce risk. The result, in many cases, is a plan that's more fragile — not less.

Here's how it actually plays out. Think about someone who is 58 and wants to retire at 62. She's lived through two major market downturns and responded by gradually shifting her investments toward very conservative positions. Her long-term projection now assumes a return in the mid-4% range. On the surface, that feels prudent.

When we model that scenario, her accounts hold steady for a few years and then gradually decline. By her late 70s, the margin for unexpected costs — health events, home repairs, family needs — is thin. There isn't much room to absorb anything unplanned.

Now model a second version: she works two additional years, and shifts toward a more balanced mix — still well within her comfort level, but with a projected return closer to the mid-5% range. Her accounts hold stronger, much longer. She has flexibility she didn't have before.

Same person. Same savings. The combination that felt safest — retire as soon as possible, stay ultra-conservative — was actually the one that left her most exposed.

This isn't an argument that everyone should take more risk. It's a more precise point: your retirement accounts need to grow enough to maintain purchasing power across a retirement that could last twenty-five to thirty-five years. A dollar today will not cover the same groceries, the same medical bills, the same lifestyle expenses in twenty years. Inflation doesn't announce itself — it just erodes, quietly, year after year.

Retirement timing and investment decisions are not emotional reflexes. They're planning variables. And the right answer isn't the one that feels the safest in March of your last working year — it's the one that holds up in your late 70s when you actually need it to.

If you want to work through what this looks like for your specific situation, our May 28th webinar — When You're Tired of Thinking About Money (But Not Ready to Stop Caring) — is designed exactly for this conversation. We'll talk through how to evaluate these decisions without reacting to the noise.

This article is for informational purposes only and not tax advice. Always consult your tax preparer for guidance specific to your situation.

LynnLeigh & Company - A Registered Investment Advisor This information is provided by LynnLeigh & Co. for general information and educational purposes based upon publicly available information from sources believed to be reliable – LynnLeigh & Co. advisors cannot assure the accuracy or completeness of these materials. The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. The information in these materials may change at any time and without notice.   Past performance is not a guarantee of future returns.

What Our Clients Are Reading