The stock market can be a rough unpredictable road to travel, and when the stock market faces trouble it can cause you understandable concern for your IRA, 401(k), and other retirement savings.

If the stock becomes volatile or shows signs of falling or crashing there are things you can do to help protect your retirement savings from stock market volatility. One of the most beneficial things you can do is to fortify your accounts as best as you can, and then go from there.

Ignoring drops in the market, especially if you are investing long-term, is an okay strategy to take as well. If drops in the market make you uneasy, then try to not look and let the stock market go through the motions. Odds are it will eventually go back up.

Keep reading this article for some steps and tips to help you keep your money safe from unforeseen events that are out of your control.

Diversification

Diversifying your portfolio is one of the big key things that you can do to decrease risk. When you have a portfolio that has bonds and stocks, the bonds can help counterbalance market volatility, and the stocks will keep the principal intact and counterbalance inflation.

One of the primary types of diversification is called asset allocation, which essentially balances risk and reward by distributing your portfolio’s assets to better meet your goals, risk tolerance, and investment time frame. When it comes to asset allocation, it is best to work with a financial advisor so you can ensure that you settle on an asset allocation method that best matches your age and investment goals.

Asset categories will increase and decrease at various rates as time moves on, so you want to make sure that you regularly re-balance your account to keep allocation consistent.

When it comes to investing in a single stock it can be risky. There is no way to beat around that bush, but investing in a single mutual fund can be a better route, because it can be fully diversified. Target-date mutual funds provide you with one-stop-shopping ease because they invest in a vast group of stocks and bonds.

Now a diversified portfolio can still lose money, but it helps to hinder your losses by decreasing overall investment risk. If you spread your money around, you will be better protected if a stock market sector crashes, because you have investments in other sectors. This increases your stability.

Balance Your Assets & Time Frame

Going along with asset allocation and figuring out what amount of your money goes into which investment, or what percentage you have in stocks versus bonds. Getting a good handle on your investment time frame is also a crucial step.

If you are close to retirement however, it is recommended that you have any money you may need for living costs in the next five years or so in cash or a cash-like investment, such as short-term bonds and certificates of deposits. This leads us to our next tip...

Have a Safety Net of Cash

If you are someone who is nearing retirement, keeping that five years' worth of living expenses in cash or cash equivalents provides you with some extra defense against slumps in the economy.

Significant, unexpected expenses can come along and if an expense occurs during a slump in the market, you will not want to take money out of your investments to help pay for an unexpected expense. Your best option is to grab cash from your savings. Having that safety net of readily available cash is important.

Try to Keep Calm and Stay Invested

The economy, along with the stock market, will always have up and down points. That is unfortunately just the way it operates. Whether it goes up or down, the best thing you can do it stay committed to your approach and regularly check up on the diversification of your portfolio.

When things go south, you want to keep your feet moving on the course and do not try to save your money by selling shares. The more you stick with your investments, the better you will be dealing with a falling period.

Also, make sure you are being disciplined about the money you take out. The more money you have safely stored away in an investment, the better you will be if things head downhill. Making early withdrawals from your retirement funds can be pretty costly, so be careful when it comes to withdrawing funds (Kurt, Investopedia).

If money in your investment portfolio is primarily for retirement, ignoring the market during volatile periods is a logical thing to do. You want to stay focused on your long-term goals instead of the short-term unstable periods of the markets. Staying invested in the stock market, even if it is falling, is still the best way to earn long-term growth in your earnings (Coombes, NerdWallet).