3 Stocks for Upcoming Retirement

Written by Jennifer Clark
Posted May 25, 2022

Did you have plans to retire in 2022? If so, you might be reconsidering those plans given the constant market volatility and inflation. And that would be a fair consideration. After all, you have probably spent your career saving money so you can live comfortably throughout retirement. Retirement is a big step and it's something that you most likely have been planning for and don’t want to push back any further. You are most likely relying on your investments to keep you financially stable as you begin to shift from being in the workforce to your retirement, and with the current market volatility and reports of the possibility of higher inflation in the future, you could be resisting that shift.

However, many experts are expressing that a down market shouldn’t be the reason for you to put off your retirement. Mindy Yu, director of investing at Betterment at Work, said:

A volatile market shouldn’t dictate whether or not you retire. Market volatility is not new, and if history is any guide, the market will eventually recover. Often the timing of upward movements can be equally surprising as the market drops. There will always be good years and bad years in the market.

I couldn’t agree more. Yu also mentioned that when you’re on the cusp of retirement, it’s important to make sure that you position your investments to preserve their balance by holding less risky assets. A few ways that could help to ensure that your portfolio has lower risk would be working with a financial advisor or using apps that offer a hands-off approach with robo-advisors. These apps can assist with rebalancing your portfolio to tolerate risk changes. The key is to keep risk low. And if you are investing, you’ll want to ensure that you’re investing in stocks that offer low risk and can weather the volatility. Here are three stocks to could be beneficial to your retirement portfolio… 1. McDonald’s Corporation (NYSE: MCD) is a restaurant chain that has essentially been the pioneer of the fast-food industry. It has been around since the 1950s and has remained resilient for more than seven decades. Without a doubt, the company has seen good and bad markets but has managed to come out alive. McDonald’s has more than 38,000 locations worldwide. It has a franchise model, which means that it has been able to make its money from rent and sales royalties while its franchisees pay for the maintenance and store operations. Over the last 46 years, McDonald's has been able to pay and raise a dividend to its shareholders. McDonald’s investors have received a 2.2% dividend yield. And over the past decade, the company has managed to grow its earnings per share by close to 7% on average each year. 2. Procter & Gamble (NYSE: PG) is involved in some of the household staples that you most likely buy each month like soaps, lotions, and laundry detergents — the company sells thousands of products under hundreds of brand names such as Crest, Tide, Pampers, Gillette. All items that a household might need to get by. The company has been in existence since the 1800s. The brand is beloved and consumers tend to buy its products for brand awareness and reliability. Consumers would budget for these types of products that PG sells because these products are crucial to a person’s everyday life of cleanliness or hygiene. 3. Coca-Cola (NYSE: KO) has been part of the NYSE since 1919. It’s an American beverage producer known for its legendary beverage that was invented in 1886. Just like McDonald’s, Coca-Cola has been able to withstand the ups and downs of the stock market. KO has paid out a dividend to its shareholders for about 60 years, and when choosing to invest in a dividend stock you’d want to invest in a company that will continue to pay out a dividend and grow that dividend. Coca-Cola has been a reliable blue-chip stock and has rewarded its shareholders over the years and could be a good fit for your retirement portfolio. Recently, Coke’s dividend yield is 2.7%, which equals about $0.44 per share each quarter. KO has to stay profitable and has been able to deliver strong financial results even during market turbulence — its recent revenue was at $10.5 billion. 

These could be examples of the types of stocks that you might want to be included in your retirement portfolio to reduce the stress that market volatility and the effects of inflation could have on your retirement. Before you stress out, remember what Yu said earlier:

There will always be good years and bad years in the market.

Stay calm and enjoy your retirement.

Until next time,

Jennifer Clark

Pro Trader Today

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