After a volatile start to the year, the stock market has rebounded — offering investors, especially retirees, a valuable chance to reassess their portfolios. Financial expert Suze Orman is encouraging older Americans to use this moment of market recovery as an opportunity to adjust their investment strategies.
Market Recovery Offers a Second Chance
Orman shared that in the first few months of 2025, the S&P 500 dropped more than 15%, and the Nasdaq 100 saw losses close to 20%. But by late June, both indexes had not only bounced back — they posted gains for the year. This quick turnaround, she says, is a rare window for reflection and course correction.
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"If you were anxious during the market sell-off in the first half of the year, now is a good time to think through whether it is indeed time to reduce your overall allocation to stocks," Orman wrote in a recent blog post
Your Strategy May Need an Update
Orman points out that the same investment strategy that worked in your 40s or early 50s might not serve you well in your 60s or 70s. While she says that stocks still have a place in retirement portfolios — particularly to help outpace inflation — she advises against holding an overly aggressive position.
Someone who once had 80% of their portfolio in stocks may now want to take a more balanced approach. "Each of us has to know what will work for us," Orman wrote. That includes reevaluating your risk tolerance as you age and your income needs shift.
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Build a Cash Cushion for Stability
One of Orman's key pieces of advice for retirees is to maintain a solid cash reserve. She recommends setting aside at least two to three years' worth of living expenses in cash — not including your emergency savings.
This buffer allows retirees to avoid dipping into stock investments during downturns, helping to preserve long-term growth while providing peace of mind. If you don't currently have that cushion, Orman suggests that now — while markets are up — may be a smart time to build it.
"Being able to cover your living costs without touching stocks when they are down…is how you sleep soundly in retirement," she explains.
Prepare for Ongoing Volatility
Although the market has shown resilience so far this year, Orman cautions that more turbulence may lie ahead. Factors like global trade uncertainty and shifts in the job market due to artificial intelligence could continue to shake investor confidence.
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Still, she says the long-term case for stocks remains strong. The key is having the right mix of investments to reflect both your risk tolerance and your retirement timeline.
Time to Rebalance?
If the recent market rally has you feeling relieved but uncertain, now may be the perfect time to rebalance your portfolio. Whether that means reducing your stock exposure, increasing your cash reserves, or simply reviewing your asset mix, Orman's message is clear: your financial strategy should evolve with your life.
"Recalibrating your overall investments in stocks to match your risk tolerance and your needs is smart prep work for whatever lies ahead," she says.
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