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“Your 401(k)s are through the roof.”
That’s President Donald Trump, posting on Truth Social shortly after noon on Nov. 4. In the same post, he wrote that the “Stock Market just hit another Record High.”(1)
The day was a big one. The Dow jumped 1,569 points, or 3%, for the day, coming after Democrats flipped both the House and the Senate in the midterms.(3)
And on the numbers, he has a point. Fidelity says the average 401(k) hit a record $155,800 as of June 30, up 10.5% in three months.(4)
Here’s why I’m not popping champagne. I was a stockbroker on Black Monday, Oct. 19, 1987. That day, the Dow fell 22.6%, a loss that remains the largest one-day stock market decline in history.(5)
Could something like that happen again?
If you’re retired or close to it, a run like this is the time to lock in some of what you’ve made, not to assume it’ll keep going. Here are 5 moves I’d make now.
1. Check how far your mix has drifted
When stocks surge, your portfolio quietly gets riskier without you lifting a finger.
That’s why it’s important to rebalance periodically between your stocks and safer stuff.
The SEC’s investor site explains why you rebalance: “Rebalancing brings a portfolio back to its original asset allocation mix.” It’s needed because “over time, some investments will grow faster than others.”(6)
Here’s how that plays out. Say you set up a $500,000 retirement account at 60% stocks and 40% bonds. If stocks gain 25% and bonds stay flat, you now have $375,000 in stocks and $200,000 in bonds. Stocks are now about 65% of your money.
A one-day drop the size of 1987’s would wipe about $84,750 off that $375,000.
That’s why this is the perfect time to talk to an expert, especially if you’re savings are big and your retirement is coming.
If you’ve got $100,000 or more invested and you’re not sure what your mix should be at your age, or how to protect your profits, a fiduciary advisor can help.
For example, SmartAsset offers a free service that matches you with up to three fiduciary financial advisors, who are required to put your interests first.
They can help with tax savings, investment advice, Social Security strategies, and planning gaps you’d never see alone. And first appointments are typically free. Free, expert advice now, and longer-term, the potential to add a valuable expert to your team.
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2. Rebalance inside your 401(k) or IRA first
As a CPA, this is the move I’d make first, because it can cost you nothing in taxes today.
In a regular brokerage account, selling a winner usually means a taxable capital gain. The IRS explains that when you sell a capital asset, the difference between your basis and what you get “is a capital gain or a capital loss.”(7)
Inside a traditional IRA, it’s different. The IRS says amounts in a traditional IRA (including earnings and gains) generally “are not taxed until you take a distribution.”(8) Likewise, the IRS says 401(k) distributions, “including earnings, are includible in taxable income at retirement,”(9) so trades inside the plan aren’t taxed along the way.
So trim stocks and add to bonds or cash inside your retirement accounts first. Touch your taxable account last.
One thing before we keep going — the financial world is louder and dumber than ever. Hot takes everywhere. Almost none of it is worth your time. I’ve spent 35+ years cutting through the noise so you don’t have to. Sign up for the free Money Talks Newsletter — 10 seconds, no spam, just the stuff that matters.
3. Park your next few years of spending somewhere boring
In my view, the real danger of a crash in retirement isn’t the paper loss. It’s being forced to sell stocks at the bottom to pay the electric bill.
That’s why money you’ll need to live on in the next few years doesn’t belong in the stock market. Take some of today’s gains and move them into cash or bonds you won’t have to sell in a downturn.
For the cash piece, compare what online banks are paying. One to look at, for example, is Barclays Online Savings. Check the current rate before you move money.
4. Trim a big winner, even one you love
I practice what I’m preaching here. I’ve made roughly $800,000 on Apple stock from a $1,700 investment 25 years ago. I’ve sold some over the years, but still own more than $300,000 worth.
Why did I sell? I trimmed the position because it had grown into too large a share of my portfolio. In short, I had too much of my money riding on one company.
If one stock or one fund now dominates your account because it’s had a great run, take some off the table. You don’t have to be right about the top to be glad you did it.
5. Don’t bail out completely
Trimming isn’t the same as running for the exits. Selling everything at a record is just market timing in reverse, and nobody can reliably call the top, or no when to get back in. That includes me.
The goal is a mix you can live with if the market drops hard next month, and one that still grows if it doesn’t.
My honest take
President Trump is right that a lot of 401(k)s look terrific right now. Enjoy it.
But I’ve seen how fast a party like this can end. In 1987, it took one day to erase more than a fifth of the Dow. Records are a gift, not a guarantee.
So take the gift. Rebalance, set aside your next few years of spending, and let the rest ride. Talk to an expert. If the market keeps climbing, you still win. If it doesn’t, you’ll be the one sleeping at night.
Sources: 1. Truth Social (via Trump’s Truth archive); 2. CNN via Yahoo Finance; 3. Spectrum News; 4. ASPPA, citing Fidelity’s Q2 2026 Retirement Analysis; 5. Federal Reserve History; 6. Investor.gov (SEC); 7. IRS; 8. IRS; 9. IRS
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