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Planning for retirement is a delicate balancing act. While you’re still working, you need to be energetic enough to make significant gains in your account if you want to enjoy a comfortable retirement. But after you finally stop working, you generally want to downgrade your risk a bit.

Therefore, for baby boomers without a reliable source of income from a job and with less time to recover from any losses, it is wise to avoid certain investments that could potentially cost you the happy retirement you have worked so hard for. Here are some of the riskiest options you should avoid.


Crypto is generally too speculative for most investors, let alone retirees. While proponents claim that cryptocurrencies like Bitcoin are the wave of the future, one of their key features so far is extreme volatility.

For example, from July to December 2017, Bitcoin’s value rose from around $2,300 to over $17,000 before plummeting again to around $3,200 by December 2018. By November 2019, Bitcoin reached an all-time high of nearly $100 to $67,000 before losing almost half of its value by January 2021 and was on track for another short-term low below $17,000. While some traders certainly made money during these huge swings, many others were taken to the cleaners. This kind of volatility means boomers should avoid all but the smallest portion of their retirement portfolio using cryptocurrencies, even big ones like Bitcoin or Ethereum.

Junk bonds

Retirees are often told that they should invest a significant portion of their portfolio in income-producing investments. Junk bonds, with their high yields compared to most other income options, could attract some boomers looking to supplement their retirement returns.

The problem with this strategy is that junk bonds are, by definition, low-quality investments. The reason they pay such high returns is to compensate investors for the risk they take. In other words, junk bonds are significantly more likely to default than higher-quality corporate bonds, making them too risky for most boomer portfolios.

Although you can reduce the risk of a single bond defaulting by investing in a junk bond mutual fund, you still face capital risk. Rising interest rates can hurt a junk bond mutual fund’s net asset value, while rising default rates — which could occur during the next recession — can also hurt your capital value.

Meme stocks

Meme stocks have made plenty of headlines in recent years for their huge gains — and crippling losses. Companies like AMC Entertainment and GameStop base their trading more on the dynamics of recreational traders investing in and exiting stocks than on their inherent economic value.

While it can be tempting to jump into meme stocks to make a quick buck, one wrong move could result in a significant portion of your retirement portfolio being wiped out in an instant. If you’re just starting out, have a career of increasing returns ahead of you, and have time to recover from a significant selloff, you may be able to afford to own or trade a few meme stocks. But if you’re retired, living on a fixed income, and don’t have the luxury of waiting for stock prices to collapse, you should avoid these.

Aggressive growth stocks

Even in retirement, you’ll likely need some level of growth in your portfolio. After all, according to IRS tables, the average 72-year-old still has a distribution period of 27.4 years, so most baby boomers should prepare for a multi-year retirement.

Because inflation reduces the value of fixed-income investments, most advisors suggest having at least some equity allocation in a retiree’s portfolio, too. But you should choose your stocks carefully—if you fill your retirement account with speculative, aggressive growth stocks, you run the risk of suffering a big loss at some point. This is the type of risk you should avoid in retirement.

Investments with high fees

High fees are the bane of every investor, but they’re especially damaging when you’re living on a fixed income in retirement. While you may be able to afford to pay additional fees if you have a portfolio that could generate gains of 20% or more – although that shouldn’t be the case – if you’re struggling, 5% or 6% off To earn a portfolio of fixed income, a 1% or 2% annual fee could wipe out 33% or more of your income.

This is the type of unreasonable fee structure that could seriously impact your quality of life in retirement.

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