Daily Money - Are Stocks Headed for a Correction?

July 20, 2021

Stocks had a lousy Monday, with the Dow closing down more than 700 points (or 2.1%)  in the index’s worst day this year. The S&P 500 fell around 1.6%. So is this the start of a correction, or will shares quickly recover? Who knows! I like to say that predicting the stock market is like forecasting the weather — while prognosticating can fill a lot of airtime, it’s just an educated guess. That doesn’t mean you shouldn’t prepare for the possibilities. You can bring an umbrella if the forecast calls for rain. And you can batten down the hatches if the outlook for stocks is stormy. The best action during a correction is usually no action, provided you’re not close to retirement and your portfolio is well allocated. Either that or doubling down on stocks while they’re on sale. Yet if you’re within several years of retirement, you might consider some defensive moves. A trusted financial advisor can help you decide how to ride out the storm.

Best wishes,

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Timely Retirement News, Insights, And Advice

Here are some numbers to put yesterday’s drop in context.

Cost doesn’t seem to be a big barrier.

If your current mortgage is over 3.88%, it’s worth serious consideration.

Retire With Money Community News

There was a fun post in our Retire with Money Facebook group this week. One member asked, “Would you share what you are doing in your retirement? I am having the best time of my life.” Along with lots of pictures of outdoor activities — hiking, birding, the beach — here are some of the written responses:

“We've been retired for a long time and what we do has evolved over time. We have traveled, read many books, assisted our children with childcare (but not on a full-time basis), volunteered, done a little part-time work, taken naps, enjoyed long lunches. We have never regretted retiring at 55 and 43.”

“We bought a terrific custom house on a golf course that is open 364 days a year for my husband, the golf-a-holic. Because it was less than half the price of the house where we raised our kids in the SF Bay Area, we are free to travel a lot: a month in Ireland during the summer, a month in Palm Desert in the winter, a month in Hawaii anytime except summer, and time visiting our kids in San Diego and Hoboken.”

“Lots of trips to Home Depot and Lowes”

“Blues/folk concerts, home repairs, delivering Meals on Wheels, and political activism”

Retirement News From Around The Web

Medicare Would Cover Dental, Vision and Hearing Under Democrats’ $3.5 Trillion Spending Plan
While there’s no guarantee the proposal will make it through the legislative process, some advocates are hopeful. CNBC

Are You Having a Late-Life Crisis?
While less well known than its younger cousin, the late-life crisis is a researched phenomenon.  NEXT AVENUE

The 7 Habits of Highly Effective Investors
How many do you follow? BLOOMBERG

Why Steady, Low Condo Fees Should Raise a Flag
In light of the tragic collapse of Champlain Towers, here’s what potential condo buyers should know. NPR

Elizabeth O'Brien is deputy editor at Money. She has covered retirement and health care for nearly a decade. A Brooklyn resident and mom of two boys, she navigates the alphabet soup of Medicare and the New York City subway system with equal ease. You can email her at elizabeth.obrien@money.com and follow her on Twitter at @elizobrien.

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