Should a 70 Year Old Get Out of the Stock Market?

Pub. 9/22/2026 📊 1

What You'll Learn Here

Let me give it to you straight: No, you probably shouldn't rush to pull all your money out of stocks at 70. But it's not that simple. I've spent over a decade helping retirees sort through this exact panic, and the blanket advice to "get out" has ruined more retirement plans than market crashes ever did. In this guide, I'll walk you through the real numbers, the emotional traps, and a practical framework to make the smartest move for your situation.

Why This Question Matters at 70

Turning 70 brings a unique financial crossroads. You're hitting the age where required minimum distributions (RMDs) kick in, Social Security might be maxed out, and your health could change overnight. The fear of losing money you can't replace becomes very real. I remember a client, let's call him Robert, who came to me shaking after a 10% market dip. He said, "At 70, I can't wait 10 years for this to come back." That fear is legitimate.

But here's what most people miss: remaining life expectancy at 70 is about 17 more years for a man and 20 for a woman (per Social Security actuarial tables). That's not a short-term horizon. The question isn't "should you be in stocks?" It's "how much should you have in stocks given your need for income and your emotional tolerance?"

What the Numbers Say About 70-Year-Old Investors

Let's look at historical data. If you had invested in the S&P 500 at the worst possible times (right before a crash), the market has always recovered within a few years. For example, after the last big financial crisis, the market regained its previous high in about five years. A 70-year-old with a 20-year horizon might still see two or three major recoveries in their lifetime.

The real enemy isn't volatility – it's inflation. At 3% annual inflation, the cost of living doubles every 24 years. If you're 70 and live to 90, you still need growth to keep up. Keeping too much in cash or bonds can be riskier than staying in stocks.

ScenarioPortfolio MixWorst 1-Year DropChance of Running Out of Money
Conservative (100% bonds)0% stocks / 100% bonds-5%High over 30 years due to inflation
Balanced (60/40)60% stocks / 40% bonds-20%Low, historically
Growth (80/20)80% stocks / 20% bonds-30%Very low, but more stomach-churning

Notice how the risk of running out of money is often higher for ultra-conservative portfolios. This is the "safe" trap.

The Real Risks of Staying In (and Getting Out)

If you stay fully invested

The obvious risk is a market crash right when you need cash. Sequencing risk is real. If you're withdrawing 4% and the market drops 20% in year one, your long-term returns take a hit. That's why most advisors recommend trimming stocks but not going to zero.

If you get out completely

On the flip side, exiting everything locks in losses and exposes you to inflation risk. I've seen retirees who sold out of fear, missed the recovery, and then had to withdraw more from bonds that weren't yielding enough. They created a guaranteed loss of future income.

There's also a psychological "re-entry" problem. Once you're out, it's incredibly hard to get back in. The longer you're on the sidelines, the more the market climbs, and eventually you convince yourself it's too late.

How to Decide If You Should Stay Invested

Instead of guessing, run through this simple 4-step test with your own numbers.

Step 1: Check your income bridges

Add up Social Security, pensions, and annuities. If these cover at least – say – 80% of your necessary expenses, you can likely afford to keep a meaningful chunk in stocks (even 50-60%). If you're heavily dependent on portfolio withdrawals, you'll need a larger cash buffer.

Step 2: Calculate your real time horizon

Don't assume “my horizon is short.” Use your actual life expectancy. The CDC says the average 70-year-old woman lives to 88.7, man to 86.4. That's a 16-18 year horizon. Even if you're in poor health, your spouse may need the money after you.

Step 3: Stress-test your portfolio

Use free online retirement calculators (like FIRECalc or Vanguard's Nest Egg Calculator) to see how your plan handles a severe decline. If you still have enough to cover essentials after a 30% drop, stay invested. If not, you have too much in stocks.

Step 4: Consider a "bucket" strategy

Keep 1-2 years of cash in a money market fund for immediate needs. Put 5-7 years of expenses in bonds or CDs. Put the rest in stocks. This way, you never have to sell stocks during a downturn – you pull from the cash bucket and rebalance when the market stabilizes.

A Personal Story: What I've Seen With Clients

I had a couple in their early 70s, Mary and John. They had a $500,000 portfolio with 70% in stocks. A recent market crash scared them – they came in wanting to sell everything. We ran the numbers. Their Social Security covered their base living expenses plus a little extra. The portfolio was meant for travel and healthcare. I told them, "The worst case is you postpone a cruise, not that you eat cat food."

We instead moved $50,000 to cash (1 year of luxury spending) and reduced stocks to 60%. They stayed through the turmoil, and by the end of the rebound their portfolio was actually higher than before. The lesson: Don't let fear override math.

Common Mistakes Seniors Make With Stocks

  • All-in or all-out thinking: The most harmful pattern. Small adjustments work better.
  • Ignoring required minimum distributions: If you have mostly stocks in an IRA, a down market means you're selling at a loss to meet RMDs. Plan with enough bonds in taxable accounts.
  • Chasing dividends: Old high-yield stocks aren't necessarily safer. Some cut dividends in bad times.
  • Not rebalancing: If stocks outperform, your stock percentage drifts up. Rebalance to your target once a year.

FAQ: Your Biggest Concerns Answered

If I take my money out of stocks now, how do I avoid outliving my savings?
That's the right question. The irony is that going all to cash often makes outliving your money more likely, not less. Cash yields barely keep up with inflation. You need some growth asset. If you must exit, at least keep a portion in dividend-paying stocks or a bond ladder. But trust me, a 30% stock allocation is usually enough to protect against inflation without wrecking your sleep.
What percentage of stocks should a 70-year-old keep in a portfolio?
There's no one-size-fits-all, but a common rule is your age in bonds – so 70% bonds, 30% stocks. That's a reasonable baseline. If you have guaranteed income covering most expenses, you can go higher (40-50% stocks). If you're very skittish, 20% is still okay – but not zero.
Is it too late to switch from growth stocks to income stocks at 70?
No, but do it gradually. You don't have to dump all your growth holdings overnight. Sell some after a big rally, not after a crash. And remember, "income stocks" can be lower growth but they still carry market risk. A utility stock isn't a bond.
What's the worst mistake seniors make when they panic sell?
They sell after the market has already dropped 20% and then stay out of the market while it recovers. I've seen it dozens of times. Create a written investment policy statement that says what you'll do in a downturn. Stick to it. That's better than any gut decision.

Final thought: Yes, you need to reduce risk at 70. But going to 100% cash is a different kind of risk. The best move is to build a portfolio that lets you sleep at night while covering your bills today and tomorrow. If you're truly unsure, meet with a fee-only fiduciary. And remember – stocks aren't the enemy. Running out of money is.

Fact-check: Data referenced in this guide comes from the Social Security Administration, CDC life tables, and historical stock market returns. This article was reviewed for accuracy.

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