Creating Flexibility When Markets Don’t Cooperate
- Ben Bina NMLS 2729340
- 24 minutes ago
- 4 min read
I subscribe to a lot of newsletters.
The majority come from financial advisors, wealth managers, and estate planning attorneys.
Not only do I enjoy reading what others write, I also enjoy finding patterns.
Over the past few weeks, the message from financial advisors and wealth managers has been remarkably consistent:
Stay disciplined with the plan.
Stay diversified.
Stay focused on what you can control.
That’s sound advice. It always is.
But here’s the part that often goes unsaid or unrealized:
Even the best portfolios can struggle when withdrawals and volatility collide.
Market change is ever-present.
Most of the time, the change – and its impact on the plan – is small.
But sometimes, the change can be jarring - to the plan, to the portfolio, and to the psyche.
The Real Risk Isn’t the Headlines. It’s the Timing
Most of the recent commentary has centered around familiar strategies:
Maintaining adequate cash reserves
Rebalancing portfolios
Avoiding emotional decisions
All important. All valid.
But underneath those recommendations is a deeper issue:
Sequence of returns risk.
Think of it this way: Risk exists. It’s been a constant since the dawn of time, rarely within your control.
When risk or disruption occurs at a specific time in your life, or perhaps in an order that compounds the challenge, the effect can be significantly more difficult. Let’s use a simple example: a flat tire.
Your risk of getting a flat tire exists, to some extent, at any point you own or operate a vehicle.
If that risk appears on a sunny, lazy Saturday afternoon, it’s an inconvenience (at worst!).
But if the flat tire happens on a snowy Monday morning on your way to a big client meeting or a job interview, the effect might be much greater.
The timing – or sequence – of the event changed the outcome. It changed your return.
If a retiree is forced to withdraw from their portfolio during a market downturn, the impact isn’t just temporary. It can create a ripple effect that lasts for years.
Same portfolio. Same average return.
Same car. Same flat tire.
Completely different outcome - depending on the timing.
What Advisors Are Trying to Solve
When you read between the lines of recent guidance, the objective is clear: Create flexibility so clients are not forced to sell assets at the wrong time. That’s it.
Not beating the market.Not predicting the next headline.
Just avoiding bad timing.
Traditionally, that flexibility comes from:
Cash buckets
Lines of credit (business or home equity, or securities-backed lending)
Spending adjustments
All useful tools.
But there’s one tool that often gets overlooked in these conversations:
The Asset Sitting Right Underneath the Plan
For many retirees, their largest asset isn’t in their portfolio.
It’s their home.
And yet, in many financial plans, home equity is treated as:
Untouchable
Passive
Or “last resort”
That approach may have made sense years ago.
Today, it’s increasingly being challenged.
A Different Way to Think About Home Equity
A reverse mortgage line of credit, when structured early and used strategically, can function as a buffer asset against sequence of returns risk.
Not as a replacement for investments.
Not as a reaction to a problem.
But as a planned layer of flexibility.
Here’s what that can look like in practice:
During strong markets, withdrawals come from the portfolio.
During down markets, withdrawals can be paused or reduced.
Instead, funds can come from a pre-established line of credit.
This creates something powerful: Optionality.
And in volatile markets, optionality is everything.
Why Timing Matters
One of the most overlooked aspects of a reverse mortgage line of credit: It’s most effective when it’s set up before it’s needed.
Not during a downturn.
Not after a disruption.
Before.
That aligns directly with what many advisors are already recommending:
Prepare in advance
Build flexibility into the plan
Avoid reactive decisions under pressure
The difference is simply expanding the toolkit.
This Isn’t About Replacing the Plan. It’s About Strengthening It
To be clear, this is not an “either/or” conversation.
Portfolio or home equity
Traditional planning or complementary strategies
Instead, it is a basic question:
How do we create the most resilient plan possible using all available resources?
For the right homeowner, a reverse mortgage line of credit can:
Reduce pressure on investment withdrawals
Provide a standby liquidity source
Serve as a contingency for long-term care or unexpected expenses
Increase the probability of portfolio longevity
A Simple Question Worth Considering
If markets stayed volatile for the next 12–24 months…
Where would your income come from, without forcing difficult decisions?
If the answer relies entirely on your portfolio, it may be worth exploring additional options.
Closing Thought
The goal isn’t to predict the next downturn, how long a conflict will last, or where gas prices will land.
It’s to be positioned so that when it happens, you’re not forced to react.
That’s what good planning does.
And sometimes, the most valuable asset in that plan is the one that’s been there all along.
If you’re a homeowner age 62+ (or advising someone who is), and you’re interested in how a reverse mortgage line of credit can be used proactively as part of a broader retirement strategy, let’s have a conversation.
No pressure. No assumptions.
Just a clear look at whether it adds value to your plan.
