Should You Panic About Bear Markets Before Retiring? 8 Reality Checks

Hearing about bear markets before retirement hits different. But here’s what the data actually says:

The Basics First Bear market = index drops 20%+ from recent high. Sounds brutal, but it’s just how markets work. Since 1928, we’ve seen 27 of them — yet there have been 28 bull markets, which last way longer (avg 2.7 years vs 9.6 months for bears).

The Scary Question: Should I Pull My Money Out? Don’t. This is where people shoot themselves in the foot. Here’s why: 42% of the S&P 500’s best days happened during bear markets. Miss the 10 best days in 30 years? Your returns get cut in half. Miss 30 best days? Down 83%.

The math is brutal: if you panic-sell and miss the recovery, you’re locking in losses while watching everyone else rebound.

What About Recessions? Bear markets don’t always mean recession. Only 15 of 27 bears since 1928 came with recessions. Don’t assume the worst.

Real Talk: How Many Will I See? Invest for 50 years? Expect roughly 14 bear markets (plus bull markets too). It’s part of the deal.

The One Thing You Can Actually Control Build a cash reserve to live off during downturns. That way you’re not forced to sell assets when they’re beaten down. Your portfolio stays intact for the rebound.

Bottom line: Bear markets are features, not bugs. The longer you panic, the more money you leave on the table.