The Long View The Biggest Risk Investors Face Today
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Aug 18, 2025 Christine Benz, Morningstar’s director of personal finance and retirement planning, dives into the current investment landscape. She discusses the risks of complacency in the stock market and emphasizes strategic diversification, especially into international stocks. Benz advocates for mutual funds and ETFs for simplified investing as we age. As emotional investing can cloud judgement, she suggests annual portfolio reviews. The conversation also touches on aligning investment strategies with personal goals for a successful retirement.
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Complacency Is The Biggest Market Risk
- U.S. investors risk complacency after a long, strong run in domestic stocks.
- A likely catalyst for a reversal is slowing economic growth that dents corporate returns.
Begin De-Risking Around Age 50
- Adjust equity exposure based on time horizon, with age 50 as a useful de-risking checkpoint.
- Build a bulwark of high-quality short and intermediate-term bonds and some cash as retirement nears.
Use Global Market-Cap For Equity Mix
- Globally diversify equity holdings using global market-cap weights as a guide.
- Target roughly 62% U.S. and 38% non-U.S. unless you have a specific reason to deviate.
