Hope to retire soon with a $10K a month spend, but worrie...

Hope to retire soon with a $10K a month spend, but worried about market downturns? How to make it a reality in 2026 Moneywise Tue, February 24, 2026 at 12:50 AM GMT+8 8 min read A press conference by U.S. President Donald Trump on tariffs is displayed on a television as traders work on the floor of the New York Stock Exchange during afternoon trading.

A press conference by U.S. President Donald Trump on tariffs is displayed on a television as traders work on the floor of the New York Stock Exchange during afternoon trading.

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For decades, the 4% rule has been a golden standard for many retirement planners. And there’s a good reason for it.

The math behind it is simple: Take your annual spending, multiply it by 25 and, at least on paper, you know what you’ll need for retirement. Want to spend $10,000 a month? That’s $120,000 a year, or roughly $3 million in savings.

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Simple, but also potentially misleading.

That’s because the 4% rule is based mostly on an assumption that long-term average returns of the stock market are stable, overlooking the impact just one bad market downturn can have early in your retirement.

In other words, you’re leaving yourself vulnerable to sudden and dramatic swings in the market. Indeed, if you experience just one market downturn early enough, it could derail the rest of your retirement journey.

Financial experts call it the sequence of returns risk.

Here’s why it could spoil your whole retirement — and three tips to keep you out of the red in your golden years.

Sequence of returns risk

The sequence of returns risk can be devastating, but it is still often “overlooked and misunderstood” by retirees, according to MassMutual (1).

But what is it, exactly?

In simple terms, it is the risk that a market downturn hits you early in retirement, compelling you to withdraw from your portfolio. The impact of withdrawing from a portfolio that is already beaten down leaves you with permanently less capital to depend on for the rest of your retirement.

For instance, let’s say you retire with exactly $3 million and want to withdraw 4% of it each year. However, your portfolio is entirely invested in the stock market, which suddenly declines 20% in the first year of your retirement. By the end of that year, your nest egg has shrunk to $2.4 million.

That’s already a loss of $600,000, but you’ve also withdrawn $120,000 during the year, so your nest egg has shrunk further — down to $2.28 million.

A loss of nearly three-quarters of a million in one year is not an easy hole to crawl out of.

In fact, this first-year loss could even be a permanent scar on your portfolio. That’s because even if the market normalizes and delivers a steady and reliable 7% annual return beyond this point, your portfolio would be worth only $2.75 million by the tenth year, still below your starting point.

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This is why sequence of returns risk can be such a hidden trap, forcing you to breach the 4% rule of thumb every year during this period.

However, there are ways to combat this risk if you plan ahead. Here are three tips to stay ahead of the sequence of returns risk.

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Tip #1: Maximize guaranteed income

One easy way to stay ahead of the curve is to make the most of what is certain to come in.

For many seniors, this is their Social Security benefits, which are not tied to stock prices and are not generally impacted by changes in the market. They provide a steady monthly income without much risk.

As of January 2026, the average monthly payout is $2,071, according to the Social Security Administration (2). And while it isn’t the full $10,000 you might want in a month, it can make a sizable difference.

In fact, 27% of retirees depend solely on Social Security benefits for their income, while they accounted for more than half of the total income for 67% of beneficiaries, as of 2024 (3).

In other words, this guaranteed source of income lets you meet at least a portion of your monthly needs.

But it requires close management of your finances.

Managing your retirement — with some help

If you want to make sure you’re safely managing your retirement savings and Social Security benefits, it could pay to speak to a qualified financial advisor.

But hiring an advisor can be a lifelong commitment, which might make or break your retirement. That’s why finding reliable advisors is crucial.

That’s where Advisor.com comes in. Their platform connects you with licensed financial professionals in your area who can provide personalized guidance.

A professional advisor can also help you determine how many years you have left to invest before retirement and assess your comfort level with market fluctuations — two key factors in building the right asset mix for your portfolio.

Through Advisor.com, you even can schedule a free, no-obligation consultation to discuss your retirement goals and long-term financial plan.

Tip #2: Bend the rule a bit

While there are good reasons behind its existence, the 4% rule is not fixed in stone — you can always bend it a bit.

For example, if you expect to collect about $2,000 a month from Social Security and use $8,000 in withdrawals from your portfolio, the rule of 4% would suggest you need a nest egg worth $2.4 million for $10,000 in monthly expenses. However, aiming for just 15% more, or about $2.76 million, should give you a comfortable buffer to withstand market turmoil and unexpected losses.

Simply put, you can stay below the 4% withdrawal rule and worry less about market crashes if you just save a little more than you actually need.

Gold is easy to bend

Another way to bend the rule is to hedge your bet against market crashes by having the right diversification mix in your portfolio.

And there’s one asset that shines brighter than the rest: Gold is a great store of value that preserves your nest egg against both inflation and unstable stock market conditions. In fact, when the stock market is shaky, gold tends to shine — as its record-breaking climb in January 2026 shows (4).

Better yet, investing in gold has become easier than ever with Priority Gold, which offers you the chance to cash in on significant tax advantages by opening a gold IRA.

Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold, making it an attractive option for those looking to potentially hedge their retirement funds against market downturns.

To learn more about how Priority Gold can help you reduce inflation’s impact on your nest egg, download their free 2026 gold investor bundle.

Tip #3: Bucket your retirement income

If bending the 4% rule isn’t enough for you, you could also try a bucket income strategy.

The strategy is simple: You divide your retirement into several “buckets” based on your spending needs over different periods of time — for example, short-term (1 to 3 years), medium-term (4 to 10 years) and long-term (10+ years) — then adopt separate investment strategies for each.

This may mean keeping some cash in highly liquid money market funds for short-term spending needs, while investing in robust bonds, government treasuries and fixed-income assets to meet medium-term needs. The rest can be invested in the stock market for long-term growth, giving your money more time to recover from any downturns and grow uninterrupted by withdrawals.

Creating these different buckets has many advantages, but perhaps the biggest one is it lets you maintain stability through different phases of your retirement, helping you establish a better budget (5).

However, managing these buckets may seem daunting at first. That’s why an excellent way to track your portfolio and income is to keep all your investments — including bonds, treasury certificates, ETFs and stocks — under one roof.

One bucket of investments

That’s where SoFi comes in.

SoFi’s easy-to-use DIY investing platform lets you buy stocks, ETFs and more with no commission fees and no account minimums.

SoFi is designed for both beginners and seasoned investors, with real-time investing news, curated content and the data you need to make smart decisions about the stocks that matter most to you.

Plus for a limited time you can get up to $1,000 in stock when you fund a new account.