Investor Behavior – Ramp Up to Retirement

How an Investment Policy Statement Helps You Manage Market Risk (Ep. 40)

By Ramp Up to Retirement | October 28, 2026

If you’re approaching retirement, how much could your investment portfolio decline before you’d start questioning your strategy? Seeing a significant loss on your account statement can be stressful, especially when you’re counting on those investments to support your retirement income.

In this episode of Ramp Up to Retirement, Dan Reese, CFP®, explains how an investment policy statement helps connect portfolio risk with your retirement goals. He explores how risk scores, diversification, and portfolio stress tests can prepare you for market volatility before it happens. Dan also explains why seeing investment changes in dollars can be more meaningful than percentages, how emotional decisions can affect long-term returns, and why a written investment strategy should evolve as your financial needs change.

Key points

How an investment policy statement connects your portfolio decisions with retirement income and tax planning needs
How understanding your personal risk score may help you put market declines into perspective and make more informed investment decisions
How portfolio diversification can reduce volatility and help keep your investments aligned with long-term goals
What historical market stress tests reveal about potential losses and your ability to stay invested during declines
Why checking investment balances too frequently can increase stress and interfere with long-term discipline
And more!