For about two years, cash was finally paying retirees something real. Then rates came down through 2025 and into 2026, and that income quietly shrank. And then, in September, the Fed reversed course and hiked for the first time since 2023 — with another increase expected before year-end.

If your retirement income depends on cash, your paycheck has now moved twice in the same year. You didn’t do anything to cause it, and you couldn’t have planned around it.

That’s the real lesson, and it isn’t “yields are bad.” It’s that a money market fund rolls over very short-term paper continuously, so its yield resets in near real time with whatever the Fed does next. Roughly $7.9 trillion sits in money market funds industry-wide — an enormous pool of retirement capital whose income is set by a committee that meets eight times a year in Washington, not by the people depending on it.

Bonds were supposed to be the answer to that. For decades the bond ladder was the workhorse of retirement income, trusted to rise when stocks fell. In 2022 it didn’t: the Bloomberg Aggregate Bond Index lost 13% in the worst year for bonds since 1842, and stocks and bonds fell together — exactly the scenario a 60/40 portfolio is built to prevent.