“It is important to not confuse risk with volatility, because volatility is something we have to live with,” Ms. Benz said. “Checking your liquid and near-liquid reserves, that’s a way of understanding how much of a buffer you have and how long a downturn you can sustain.”For those looking to improve their flexibility, or ability to avoid selling in a volatile market, she often asks people to consider the answers to a range of questions, including: What would it look like to find a job that replaced the income you would require your portfolio to generate? What would your expenses look like if you downsized? She encourage …
