I'm 66 years old, have a paid-off house and $100K sitting in cash. Would this be a good time to invest it all in the S&P 500?

It’s a question that cuts to the heart of one of the most common dilemmas in retirement planning: when does playing it safe actually mean falling behind?

What’s happening with the stock market

The S&P 500 has been rallying since the end of March — despite the conflict in Iran and a blockade of the Strait of Hormuz that’s led to the largest oil-supply disruption in history and sent energy prices soaring.

The U.S. stock index initially fell during the first few weeks of the conflict, which began February 28. But stocks have since rebounded, now trading near all-time highs.

“The stock market isn’t trying to price what’s happening today,” senior markets economist at J.P. Morgan Private Bank, Joe Seydl told CNBC. “The stock market is always trying to price what the world is going to look like six to 12 months from now.”

At the same time, the S&P 500 has been buoyed by gains in tech and AI-related stocks — driven in large part by increasing demand for data centres to fuel rapid AI growth. This is despite inflation concerns tied to rising oil prices.

Still, there are whispers of a market correction — or worse. Billionaire investor Warren Buffett has warned the stock market is “playing with fire,” and “Big Short” investor Michael Burry is sounding alarms about a dot-com-style crash.

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To invest or not to invest?

Since its launch in 1957, the S&P 500 has delivered average annual returns of around 10.5%. Markets have historically recovered after downturns, though timelines vary widely. For Canadians who may need access to their money sooner rather than later, that uncertainty matters.

For Patricia — or any Canadian in a similar position — deciding whether to move a large amount of cash into index funds comes down to how much risk you’re comfortable with and how much time you have to invest. Many financial planners suggest that investors who are close to or are already in retirement shift toward safer, more stable investments to protect against market swings.

But being too conservative carries its own risk. If Patricia’s $100,000 is earning 3% in a HISA and inflation is running at 3.5%, she’s slowly losing purchasing power.

If she doesn’t need the money for another five to 10 years, she may be able to afford more risk — if she’s comfortable with it. The key question is whether a sudden 30% market drop would keep her up at night.

The Canadian retirement income picture

Canadians have a two-pillar public retirement income system: The Canada Pension Plan (CPP) and Old Age Security (OAS).

CPP benefits can begin as early as age 60, but at a reduced rate. Taking CPP at 65 gives you the standard amount, and deferring to age 70 increases the monthly benefit by 42% compared to taking it at 65, according to the Government of Canada. Similarly, OAS begins at 65 and can also be deferred to 70, resulting in a 36% increase in monthly payments.

If Patricia can cover her living expenses through part-time consulting and by drawing on her Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF), deferring both CPP and OAS even a few years could meaningfully boost her guaranteed income — and reduce pressure on her investment portfolio.

If Patricia sets herself up this way, she’ll have some flexibility for how she approaches her $100,000. With a predictable government income starting in a few years, she could take on moderate investment risk in the meantime.

To get started, open a no-fee RRSP high-interest savings account with EQ Bank. For a limited time, get up to $200 cash when you add new deposits to your EQ Bank RRSP account.

What about health-care costs?

Canadians often assume that their provincial health plan covers them from major out-of-pocket medical expenses. But provincial plans — such as OHIP in Ontario or MSP in British Columbia — don’t cover dental, vision, most prescription drugs or long-term care.

Long-term care costs in Canada are significant. According to the Canadian Life and Health Insurance Association (CLHIA), the average long-term care cost in a subsidized room ranges from $1,300 to $3,500, and $6,000 to around $9,000 a month for a private room, depending on the province.

Patricia should plan for potential long-term care costs — and make sure she has enough coverage or savings to pay for them without draining her investments.

Diversification and the concentration problem

Many financial experts recommend spreading investments across different types of assets industries and regions. The S&P 500, however, has become increasingly dominated by a small number of large technology companies — a concentration that’s raised concerns among market watchers concerned about how fragile the index could become.

For Canadian investors, broad market exposure can also mean holding the S&P/TSX Composite Index, funds that track international markets, and bonds. A balanced portfolio might combine Canadian stocks and bonds — adjusted for Patricia’s age and risk she’s comfortable taking on.

Conservative alternatives: GICs and HISAs

If Patricia isn’t comfortable taking on significant market risk right now — especially with ongoing global uncertainty — she has two low-risk options well-suited to Canadian investors.

A Guaranteed Investment Certificate (GIC) is a Canadian investment that offers a fixed interest rate for a set term — typically 30 days to five years — and is insured by the Canada Deposit Insurance Corporation (CDIC) up to $100,000 per depositor per member institution. As of May 2026, one-year GIC rates from major Canadian financial institutions range from approximately 2.15% to 2.70%.

The downside of this option is lower long-term return potential — but for a retiree who values stability over growth, that tradeoff can make sense.

What Patricia should do next

Patricia’s situation warrants a conversation with a fee-only financial adviser. A qualified adviser can help her model different scenarios: What happens to her portfolio under different market conditions? How does CPP/OAS timing affect her income? Also, how does she balance withdrawals from registered and non-registered accounts to minimize tax?