April Market Review: Confidence, Resilience, and Our Enduring Investment Framework
May 1, 2025
April was a turbulent month for financial markets, marked by sharp swings in stocks and ongoing debates about inflation, tariffs, and the economic outlook. For retirees and those nearing retirement, these headlines can understandably raise concerns about nest eggs and future income. However, as we review the facts and our investment approach, there are strong reasons to remain confident and optimistic about your long-term plan.
Market Performance and Economic Backdrop
The S&P 500 briefly slipped into bear market territory in April but recovered to end the month down just 0.9%. The Dow Jones Industrial Average is projected to finish April with a 3.5% decline, while the Nasdaq Composite is approximately 0.4% higher for the month 1. Notably, the market saw a strong finish, with the S&P 500 jumping more than 1% and the Nasdaq up about 2% on the last day of April, driven by robust earnings from major technology companies 2.
Market volatility was largely driven by renewed tariff actions and uncertainty over economic growth. President Trump’s announcement of a 90-day pause on new reciprocal tariffs mid-month provided some relief, but the initial imposition of tariffs in early April contributed to choppy trading 1.
According to the U.S. Bureau of Economic Analysis, real gross domestic product (GDP) decreased at an annual rate of 0.3% in the first quarter of 2025, a reversal from the 2.4% growth seen in the previous quarter. The decline was mainly due to increased imports and reduced government spending, partially offset by gains in investment and consumer spending 3.
Inflation pressures persisted, with the personal consumption expenditures (PCE) price index rising 3.6% in the first quarter, up from 2.4% in the previous quarter 3.
The labor market remained stable, with the unemployment rate averaging 4.1% over the past two quarters and labor force participation among those aged 55 or older holding steady 4.
Key Concerns for Retirees: What’s Top of Mind
Recent surveys show retirees are most concerned about:
The rising cost of living and persistent inflation 5
Potential changes to Social Security and Medicare 5
Market volatility and the risk of outliving savings 5
Despite these concerns, confidence among retirees remains high. Nearly 80% of retirees report feeling secure about their ability to live comfortably throughout retirement, a slight increase from last year. This optimism is a testament to the value of careful financial planning and diversified investment strategies 6.
Our Approach: Long-Term Planning and Navigating the Inevitable
When we create financial plans for clients, we’re planning for horizons that often stretch 20 to 40 years. We know that market pullbacks are part of the journey- they’re not pleasant, but they’re never a surprise. Long-term success isn’t about avoiding downturns altogether, but about navigating them with discipline and perspective.
The 5 Rules of Investing: Our Guiding Principles
To help our clients achieve their goals and maintain peace of mind, we adhere to a simple yet powerful 5 Rules of Investing:
Minimize Taxes
Minimize Fees
Remove Emotions from the investment process
Avoid Gurus (those who claim they can predict the markets)
Stay Diversified
We believe that following these rules is essential for a positive financial experience. Breaking any of them increases risk and undermines the foundation of a sound retirement plan. That’s why, even during periods of market stress, we remain committed to these principles.
Why Confidence in Your Plan Still Makes Sense
Diversification Works: Even as U.S. stocks faced headwinds, international stocks and bonds provided balance, cushioning portfolios from the full impact of domestic volatility.
Income Strategies Remain Sound: Many retirees benefit from a mix of Social Security, pensions, and income-generating investments like dividend stocks, bonds, and annuities. These sources help manage market fluctuations and provide steady cash flow.
Inflation Protection: Tools such as Treasury Inflation-Protected Securities (TIPS) and dividend growth strategies are designed to help maintain purchasing power over time.
Staying the Course Pays Off: History shows that reacting emotionally to short-term market swings often leads to poorer outcomes. Staying invested according to a well-thought-out plan is usually the best approach, especially for retirees who rely on their portfolios for income.
“The best advice for retirement savers is to stay the course in terms of your asset allocation… Time in the market beats timing the market.” – Vanguard’s Zach Rayfield
Looking Ahead with Optimism
While April’s market turbulence was unsettling, it’s important to remember that volatility is a normal part of investing, especially in the short term. The fundamentals supporting long-term growth, innovation, global economic expansion, and resilient consumer demand remain intact. Moreover, recent data shows that retirees are adapting, making prudent spending adjustments and working closely with advisors to ensure their strategies remain aligned with their goals 7.
Our commitment is to guide you through all market conditions, sticking to your resilient financial plan and following the 5 Rules of Investing. This approach has served our clients well through many market cycles.
In Summary
April brought market volatility, but well-diversified retirement portfolios proved resilient.
Retiree confidence remains strong, even as inflation and policy concerns persist.
Staying disciplined and focused on your long-term plan is the best way to weather uncertainty and enjoy a secure retirement.
As always, I’m here to answer your questions and ensure your financial plan continues to support your retirement dreams. Let’s look ahead with confidence, your financial future remains bright.
Thank you for reading!
Your retirement and tax planning partner,
– Jason Sherman, CFP® AIF®
Citations
https://www.cnbc.com/2025/04/29/stock-market-today-live-updates.html
https://www.cnbc.com/2025/04/30/stock-market-today-live-updates.html
https://www.bea.gov/news/2025/gross-domestic-product-1st-quarter-2025-advance-estimate
https://home.treasury.gov/news/press-releases/sb0114
https://www.ebri.org/docs/default-source/rcs/2025-rcs/2025-rcs-release-report.pdf?sfvrsn=f5e3042f_3
https://www.thestreet.com/retirement-daily/planning-living-retirement/retirement-confidence-survey-2025
https://thedailyrecord.com/2025/04/28/retirees-market-volatility-retirement-concernsmarket-turmoil-has-many-afraid-to-check-retirement-savings/
From our Legal Team: This material was prepared by Sherman Private Wealth. All information is believed to be from reliable sources; however, Sherman Private Wealth makes no representation as to its completeness or accuracy. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk. Past performance does not guarantee future results. Asset allocation does not ensure a profit or protect against a loss.
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