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Down markets up the odds you run out of money in retirement.

This is particularly true for people just about to retire or who have recently done so. In fact, this period is so important in times of volatility the managing director of financial planning at Charles Schwab told Bloomberg Wealth this week that he sees it as “the red zone.”

The reason? Sudden drops in this period could force underprepared retirees with lots of stock but insufficient cash to sell low to cover their expenses. That cuts into the overall return a portfolio can generate in retirement, increasing the odds of running out of money.

How do you prevent this from happening? With markets tumbling and many Americans concerned about their portfolios, I called four financial advisers to ask.

Ideal Scenario

The best way to avoid what experts call “sequence of return risk” is to set aside enough cash for the first couple years of retirement — that way you won’t have to sell during a downturn. Suggestions of how much cash to keep varied from roughly 18 months to five years, yet the reasons were all the same. If you can cover yourself until a recovery, you won’t have to clock a single loss.

But for many, this ideal scenario might not be possible. And if you are in that red zone or know someone who is, here are a few strategies to consider right before and after retirement:

Right Before Retirement

I’ll start with the worst but maybe most helpful tip: Work longer. Nobody wants to hear this, but in difficult times, advisers say it’s important to focus on what you can control. If you are lucky enough to have the ability to stay in your job until a market recovery, your portfolio may thank you later.

“Now I wouldn’t say that to someone who’s like 74 now,” said Sarah Behr, founder of Simplify Financial Planning in San Francisco. “But if you’re worried about your retirement budget being kind of tight and you can hang on for a little bit longer, that could really help.”

Extra time could help you avoid selling before a recovery. It also gives you more ways to build that cash buffer. This relates to the next tip, which is to sell some of your winners. Remember that not all stocks have dropped this year. International indices in particular have been on a tear, and those earnings may present an opportunity.

“You might be able to take those gains and then consider something where you can still earn returns, but maybe in a safer vehicle like T-bills,” said Melissa Caro of My Retirement Network in New York. Such Treasuries could serve as part of your cash buffer in retirement later.

Right After Retirement

The stakes are higher once you’ve left the labor force. But that doesn’t mean you’re out of options.

“Imagine if you were facing a job loss,” said Caro. “You go into an austerity budget and hang tight.”

Her point — and one echoed across the advisers I spoke with — is that in the first few years of retirement, one of the most powerful levers you have is how much you spend. Early on, many are looser with that lever than they intend, splurging on everything from expensive travel to home renovations to newfound hobbies. Some costs you can’t control, but those that you can help reduce the risk of selling low.

Elliot Pepper, financial planner and director of tax at Northbrook Financial, said market slumps may be a time to consider taking Social Security earlier. Many workers purposely delay taking such benefits to increase their payouts from the program. But getting that income earlier could help you cover short-term costs, rather than using stocks.

“It might mean that your lifetime income projection from Social Security goes down,” said Pepper. “But don’t just look at the spreadsheet in moments like this. Think about how maybe you can use Social Security to make you feel better and not have to draw from your portfolio as much.” Doing so may mean your Social Security payouts are lower, but your overall portfolio returns in the long run could end up higher.

Finally, Judy Brown of SC&H Wealth in Washington, DC, had a few silver linings for recent retirees. First, down markets may be a good time to tax-loss harvest. Selling some of your losing stocks now means a chance to offset gains later. Brown reminded me that people often forget tax-loss harvesting can be done throughout the year. What’s more, there is a world where the market recovers faster than analysts expect, and this tax-loss harvesting opportunity vanishes.

Now could also be a good moment to do a Roth conversion, especially for those retirees who haven’t started collecting Social Security yet, Brown said. Those in this boat may find themselves in lower tax brackets now than they will be in the future, meaning they pay less in tax to convert. What’s more, investments put into Roths now — taxed at your current rate — will grow tax free, which could be a boon in a market recovery.

So yes, the chaos and turbulence in the markets have been worrisome for investors, especially those in the red zone. But there are ways out.

— Charlie Wells

P.S. Send questions about your own financial dilemmas to bbgwealth@bloomberg.net. We may get expert answers for you, and feature your question and the answer in an upcoming newsletter.

Real Estate Watch

Photographer: Tomi Um

Spring is right around the corner in the Northern hemisphere and that means the start of another selling season. But uncertainty about prices, rates and consumer confidence mean that yet again, this year is likely to be another difficult one to navigate.

With all this in mind, my colleagues have put together some helpful guides if you’re planning to make a property move this season:

Here’s an overview of where the market stands now
Thinking of refinancing? Learn how here
What first-time buyers need to know
And I couldn’t resist this one about how to win a bidding war

Market Moves

Intel shares jumped. The company named Lip-Bu Tan as its next chief executive officer, entrusting a former board member and semiconductor veteran with one of the toughest jobs in the chip industry. Intel dominated the semiconductor field for decades, but is struggling with market-share losses to the likes of Nvidia, manufacturing setbacks and a precipitous decline in its earnings.

Top oil traders have turned bearish on prices. While they don’t see the prospect of a crash, top traders including Vitol and Gunvor said prices could grind lower as supply starts to outstrip demand. The OPEC+ group of producers has begun releasing additional barrels into the market, the US will continue to add production — albeit more slowly than in recent years — and South America is also growing. The prospect of Russian sanctions being eased is another factor adding to the bearish mood.

Wealth Gains

The biggest gainers and losers on the Bloomberg Billionaires Index over the past week:

Xu Gaoming was the biggest gainer in percentage terms. He clocked a 19% increase, bringing his wealth to $9.4 billion. Xu is the founder and chairman of Beijing-based Laopu Gold, a chain of jewelry stores and the maker of pendants, bracelets and other gold ornaments. The majority of his fortune is derived from his stake in the company, which has become a market darling since its IPO less than a year ago.

Mike Sabel lost the most percentage-wise, with a 28% dip that took his wealth to $14.1 billion. Sabel is the chief executive of Venture Global, an Arlington, Virginia-based LNG supplier and his fortune comes from an ownership stake in the company. The stock has imploded since its initial public offering in January. The slide accelerated last week as the company reported lackluster results and talked down the year ahead.

Know Anyone Who…?

This week, we’re looking to speak to people who bought or sold Bitcoin when it was trading above $100,000. Did you jump into crypto for the first time recently? Did you decide now is the best point to cash out?

We want to hear from you. Email bbgwealth@bloomberg.net to get in touch.

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