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How to Survive a Bear Market if You’re Over 50 – AARP

iStock / Getty Images


iStock / Getty Images

The stock market isn’t officially in a bear market yet, but some segments of it certainly are. What causes bear markets, and how do they affect older investors who are saving for retirement or already retired?

A bear market is, by definition, a 20 percent decline from the most recent market top. Currently, the Standard & Poor’s 500 stock index, the benchmark index that measures the performance of 500 of the largest U.S. stocks, is down about 17 percent from its peak on Jan. 3, 2022. In stock market parlance, that’s a “correction,” which is a decline of between 10 percent and 20 percent.

According to brokerage firm Charles Schwab & Co., corrections are relatively common. The S&P 500 has fallen at least 10 percent in 10 out of the past 20 years, with an average pullback of 15 percent. And in two additional years, the decline was just short of 10 percent.

The carnage within some stocks in the Nasdaq 100 has been, well, grizzly. Netflix shares, for example, have plunged 75 percent from a high on Nov. 17, 2021. Online payment company PayPal is down 74 percent from its high; drugmaker Moderna is down 73 percent from its high.


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