Key takeaways:
- Discipline During Market Volatility is Historically a Good Strategy
Many investors stayed the course during the 2025 market correction, highlighting the value of long-term strategies like buy-and-hold investing over market timing. - Dividend Stocks and Diversification Are Key Considerations
Dividend-paying stocks remain a popular income strategy for retirees, especially when paired with international diversification for investors seeking to enhance yield and reduce portfolio risk. - Cash Reserves and IRA Rollovers Support Stability
Maintaining a cash reserve can help retirees avoid selling investments during downturns, while rolling over old 401(k)s into IRAs can offer more control, tax advantages, and better alignment with retirement goals.
Staying the Course Pays Off
In 2025, investors were tested by a sharp market correction, yet many demonstrated remarkable discipline. According to Janus Henderson’s 2025 Investor Survey, which looked at how affluent investors aged 50 and older are preparing the future, 36% took no action during the downturn. Others made modest adjustments such as reducing discretionary spending (34%) or boosting emergency funds (22%).
This behavior underscores the importance of long-term thinking. History tells us that market timing—trying to predict when to buy or sell—can be costly. Missing just the 10 best days in the market over a 25-year period could cut your returns in half. Missing 40 top-performing days could even result in a loss. The lesson? A disciplined, buy-and-hold strategy remains one of the most effective approaches for investors nearing retirement.
Dividend Stocks: A Preferred Income Strategy
Generating reliable income is a top priority for retirees, and dividend-paying stocks continue to be a favored solution according to our survey. Nearly 60% of respondents to our Investor Survey either already invest in or plan to invest in dividend stocks. These stocks can offer regular cash flow, potential inflation protection, and favorable tax treatment.
However, it’s important to understand that dividends are not guaranteed. Companies may reduce or eliminate them during financial stress. That’s why it’s important to focus on firms with a consistent history of increasing dividends annually. Diversification is also key. A global dividend strategy might be one consideration for investors seeking to enhance yield and reduce portfolio risk. Encouragingly, these potential advantages appear to be resonating with investors: 44% of survey respondents said they are expanding into international holdings.
Beyond Dividends: Consider a Cash Reserve
Another sound practice for retirement income planning is maintaining a cash reserve. Many retirees hold one to two years’ worth of living expenses in cash equivalents or something like a money market fund. This buffer allows investors to avoid selling assets during market downturns, and may provide peace of mind and stability.
Considering a Rollover?
All of this may lead you to consider taking action. Rolling over an old 401(k) account into an IRA is a common financial transaction, yet many investors may forget to take this important step. The total value of abandoned 401(k) assets has now grown to $2.1 trillion. While those assets may still be invested and earning, there is certainly an opportunity for investors to do more.
If you’re thinking about rolling an account out of a 401(k) or elsewhere, here are some key considerations:
- Control
Rolling over to an IRA can give you greater control over your investments, sometimes that includes access to a broader range of asset classes. IRAs also increasingly offer access to different types of investments that may better align with your advanced portfolio strategies or long-term financial goals. - Taxes
As of 2025, the Required Minimum Distribution (RMD) age is 73 and will increase to 75 in 2033 for individuals born in 1960 or later. Roth conversions remain available with no income limits, but recent legislation introduced new deductions and phase-outs that can affect your effective marginal tax rate. Be mindful that Roth conversions may impact Medicare premiums and eligibility for deductions like the new Senior Deduction, which phases out at $150,000 modified adjusted gross income. - Planning
With evolving tax laws and RMD rules, planning is essential. Under current rules, most non-spouse beneficiaries must deplete inherited IRAs within 10 years. These issues may impact complex decisions like Roth conversions, tax-efficient withdrawals, and legacy strategies—all of which require proactive planning. Strategic timing and income modeling are more important than ever, so be sure to work with your tax planner to minimize your tax impact.
Final Thought
Retirement investing doesn’t have to be complicated. With discipline, diversified income sources, and a clear plan, investors can build sustainable income and enjoy greater financial confidence.
Take Control of Your Retirement with our Rollover Concierge Service
Transferring retirement accounts can be daunting, but with our expert guidance, you can effortlessly transfer or roll over retirement accounts. Our specialists will walk you through every step so you can feel confident and in control of your retirement journey.
What’s more, we’ll even give you a bonus for transferring your retirement accounts to us. Roll over or transfer your eligible retirement accounts to a Janus Henderson Traditional, Roth, or SEP IRA to receive up to $2,500 toward your IRA and up to a 10% match on your 2027 IRA contributions.