Should you keep investing the same way in retirement that you did while you were working?
The short answer is no.
And the bigger your portfolio, the more that shift matters.
I’ve spent the last 15 years helping families navigate this exact transition, and here’s what I’ve learned: most people never fully make this shift. They either keep investing like they’re still 45, or they get so conservative that they underspend for the rest of their life.
Both outcomes are avoidable.
Today I want to walk you through the framework I use with clients to make sure their money is actually working for the retirement they’re in — not the one they used to be saving for.
1. Your Portfolio Just Got a New Job
During your working years, your portfolio has one job: grow.
You save. You invest. You let time do the heavy lifting.
The ups and downs along the way don’t feel great, but they don’t actually hurt you, because you’re not relying on that money yet.
Retirement changes that.
The moment you start withdrawing from your portfolio, your dependence on it changes completely.
You still need growth — inflation doesn’t stop just because you stopped working.
But now you also need protection, because a downturn that hits while you’re withdrawing money behaves very differently than a downturn that hits while you’re still saving.
So your portfolio goes from having one job to having two: growth and protection.
The real skill in retirement isn’t picking the right investment or timing the market.
It’s figuring out how much of your money goes to each job.
2. Why “Just Keep Some in Cash” Isn’t a Strategy
Most retirement advice sounds something like this: keep some in stocks, keep some in cash, and don’t take on more risk than you need to.
That’s not wrong.
It’s just incomplete.
Follow vague advice like that for 20 or 30 years and you’ll likely land in one of two places: forced to sell everything at the worst possible time, or forced to underspend for the rest of your life because your money was never protected the way it needed to be.
Here’s why. Using the S&P 500 as a hypothetical, illustrative benchmark — and to be clear, this isn’t a recommendation to invest in any specific index — stocks have historically delivered strong long-term growth. But that growth has never arrived smoothly. Some years have been dramatically above average, and some years have been dramatically below it.
That volatility is the price of admission for growth.
It’s not a flaw in the system. It’s the system.
And when you’re still working, that volatility barely touches you.
But picture retiring right as a steep downturn hits, and needing to pull income from your portfolio at the same time.
You’re not just watching the balance drop.
You’re withdrawing from a balance that’s already dropped, which accelerates the decline.
That combination — withdrawals plus a downturn — is where a lot of retirement plans quietly get derailed.
3. Introducing Root Reserves
So how do you protect against that?
This is where we introduce what we call, internally, Root Reserves.
The idea is simple: carve out a portion of your portfolio specifically designed to fund your living expenses during a market downturn, so you’re never forced to sell stocks while they’re down.
Historically, stock market downturns have lasted around two and a half years on average, and in especially rough stretches, recovery has taken closer to five.
So the goal of Root Reserves is to buy time. Enough time that your growth investments can recover before you ever have to touch them.
In a hypothetical example, if you’re planning to withdraw a set amount each year in retirement, Root Reserves would represent roughly five years’ worth of that withdrawal amount, held in more conservative, stable investments.
Not to grow aggressively.
To be there when you need them.
4. How the Reserve Is Built, Year by Year
Not all five years of reserves need to sit in the same type of investment.
Year one might sit in something extremely conservative and stable, because that money may be needed almost immediately.
Years two through five can take on slightly more risk in exchange for a bit more return, since that money has more time before it’s needed.
This layered approach means every dollar in your reserve is doing a job that matches how soon you’ll actually need it.
The result? A retirement income strategy that isn’t dependent on guessing which direction the market goes next.
5. The Real Risk Isn’t the Market. It’s the Order.
Here’s a concept worth understanding: sequence of return risk.
It’s the risk that the market drops early in your retirement, right as you begin taking withdrawals — and that timing, more than your average long-term return, ends up shaping how sustainable your retirement really is.
Two people can have the exact same average return over 20 years and end up in wildly different places, purely because of when the good years and bad years happened to fall.
You can’t control the market’s timing.
But you can control how much of your spending depends on it in any given year.
That’s the entire purpose behind building a reserve.
6. A Story Worth Remembering
I once sat down with a prospective client who was ready to retire.
He had enough to do it — on paper.
But nearly all of it was concentrated in three individual stocks that had performed incredibly well over the prior decade.
I told him, honestly, that my recommendation would sound boring: sell some of those positions and diversify into more stable investments.
He couldn’t do it.
Those stocks had built his wealth. Why would he sell the thing that got him here?
He retired anyway, fully concentrated, right before a sharp downturn hit those same stocks harder than the broader market.
He ended up going back to work.
Not because the market didn’t eventually recover — it did.
But because he needed to live off money that had dropped sharply, with nothing set aside to buy time.
That’s the risk this whole framework is built to avoid.
7. Every Dollar Should Know Its Job
The size of your portfolio was never really the deciding factor.
The real question is simpler: does every dollar in your portfolio know its job?
Get that split right, and a rough year in the market doesn’t have to derail your retirement.
That’s not about predicting what the market will do next.
It’s about making sure your plan doesn’t depend on getting that prediction right.
If you’re approaching retirement, or already there, and you want a clearer picture of how your own portfolio’s “two jobs” are currently split, that’s exactly the kind of conversation worth having.