Market fluctuations and uncertainty have a way of dominating the headlines. You’re much more likely to start your day with news about recessions, inflation, and affordability crises than with a positive outlook from the talking heads. It just goes to show that bad news can sell, engage audiences, and travel faster than good news.

Take the past year, for example. Investors were exposed to no shortage of emotionally charged narratives: concerns about economic slowdowns, inflation persistence, global instability, and policy shifts dominated the conversation. These types of stories are typically designed to create a sense of urgency.

Yet when the year was over, the gap between market predictions and how Wall Street actually behaved reminded us that markets rarely move in straight lines, and reacting to financial forecasts can create more harm than clarity.

That’s not to say you should always ignore the headlines and hold your ground. Sometimes, especially for retirees and pre-retirees, action may be needed. Which brings up an important question: What should you do when the stock market dips? And how do you know what to respond to and what to ignore?

Financial Forecasts: Misplaced Confidence

Economists love to talk about market predictions. And we love to listen! When things feel uncertain, we want to be able to fall back on expert opinions, whether it’s the doctor’s prognosis or the mechanic’s diagnosis. However, financial forecasting isn’t as simple as diagnosing a faulty engine.

Take 2025, for example. Early in the year, tariff announcements sparked a sharp pullback that unsettled even seasoned investors, and year-end market projections were revised almost immediately. Yet as the year unfolded, markets recovered and ultimately delivered solid gains. The disconnect between predictions and performance underscores a familiar reality: short-term reactions can say more about emotion than long-term fundamentals.

Even as markets moved higher, headlines continued to emphasize delayed economic pain, unresolved policy risks, and questions about whether recent growth could last. These concerns may prove valid in time, or they may not. One takeaway is that risk hasn’t disappeared, but that confident-sounding forecasts can lag reality.

For investors nearing retirement, this can reinforce why long-term planning, disciplined monitoring, and flexibility may matter far more than the latest prediction. Markets have historically continued to climb, pull back, and sometimes surprise. A well-constructed financial strategy is designed to move with what matters, not with what gets clicks.

What to Focus on Instead of Headlines

This is all well and good, but ignoring sensationalist headlines isn’t a financial strategy. A deliberate strategy that is designed to align with your goals, risk tolerance, and whole financial picture is what matters. Here are four things to consider building into your financial plan from the start and revisit when a bear market hits.

1. Filter Decisions Through Your Long-Term Strategy

Your investment allocation should reflect your retirement timeline, income needs, and risk tolerance, not the latest prediction. When you’re tempted to react, ask yourself: have these fundamentals changed? If not, your strategy may not need dramatic adjustments, even if the news cycle suggests otherwise. Remember, the headlines may change tomorrow. Your goals won’t.

2. Build and Maintain Financial Flexibility

Liquidity can matter more as retirement approaches. Having adequate cash reserves may help you avoid pulling from long-term investments at inopportune times, and can also be helpful for business owners. As you near retirement, consider talking to an advisor to help evaluate your emergency fund and add to it if needed. Flexibility can create breathing room, and breathing room can allow for better decision-making.

3. Reevaluate Risk Through a Practical Lens

Risk isn’t just about market swings; it’s about how those swings affect your ability to fund your life. Reviewing downside exposure, withdrawal sequencing, and income durability can help your portfolio support your lifestyle, even during periods of uncertainty. When volatility hits, you may have a better idea of how much you’ve already planned to handle.

4. Coordinate Asset Location, Allocation, and Tax Strategy

Diversification includes how your assets are spread across account types. Coordinating taxable, tax-deferred, and tax-free accounts may help improve after-tax outcomes and may help give you more control over income in volatile years, which can be important for business owners managing uneven cash flow.

A Thoughtful Way Forward

Market uncertainty isn’t always a signal to abandon your plan. If anything, it can be a reminder that the market is doing what it has historically done! When our clients are tempted to pull the plug, we encourage them to pause and ask, “Is my financial plan doing its job?”

1. Are you positioned to replace income sustainably in retirement?
2. Is your withdrawal strategy tax-aware and flexible?
3. Are business assets, retirement accounts, and personal savings working together?

At LightForce Financial, we work to help clients replace reactive decisions with structured planning. We don’t know what the market may do tomorrow, but we believe two things are likely:

1. A doomsday market forecaster somewhere may be getting a paycheck.
2. Resilient investors aren’t those who predict the future correctly, but those who prepare for multiple outcomes.

If you want to make sure your financial plan is designed to adapt, schedule a consultation with our firm. We work to help you look at what may be important considerations and create a plan designed to help preserve your future.

LightForce Financial

Phone: 817-717-4400

Email: gerald@lightforcefinancial.com

Contact us: https://lightforcefinancial.com/contact-us/

Important Disclosures: This content is provided for general educational and informational purposes only and should not be construed as tax, legal, or financial advice. Tax laws are complex and subject to change, and individual circumstances vary significantly. This information does not constitute a recommendation for any specific action or strategy. For advice regarding your specific tax situation, please consult with qualified tax professionals, certified public accountants, or tax attorneys who can provide guidance tailored to your individual circumstances. We do not provide tax preparation services or specific tax advice. Tax laws and regulations are subject to interpretation and change by relevant authorities.

As with any financial decision, there is potential for various outcomes, and we do not guarantee any specific results. This presentation is not an offer or a solicitation to buy or sell securities. The information contained in this presentation has been compiled from third-party sources. All information is from a third-party believed to be reliable; however, Lightforce Financial, a dba of Advisor Resource Council, makes no representation as to its completeness or accuracy. Investing in securities is speculative and carries a high degree of risk. Past performance is no guarantee of future results. Additional information, including management fees and expenses, is provided on Advisor Resource Council’s Form ADV Part 2, which is available upon request. Click here to view this item. https://adviserinfo.sec.gov/firm/summary/164109