September 2016 –Q:I am 70 years old and still have money in the stock market. I have watched it go up and down in recent months, and I am getting fearful. What should I do?
A: If it is money that you are using to supplement your income, then you must preserve it with all caution. Do not expose all of your investments to the market. This means that you should not have all of it in mutual funds or even individual stocks or bonds. I strongly suggest you should have a minimum of 50% in a money market account of a CD at your local bank.
The goal is to preserve the principal for when the market turns down, especially if this is money that you will need to live on. If this is money that you are never going to use, then I suggest letting it ride out the market for the next 10 years or so. But understand, there will be some nerve wracking times.
____________________ Dan Celia has been in financial management for more than 30 years. He works closely with AFA Foundation and can be heard six days a week on AFR Talk (afr.net).