My wife and I are in a bit of a panic over events in the Middle East and the impact this is having on our pensions.

We are both soon to be 70 and while we both continue to work and claim the state pension, we are relying on our stocks and shares investments within our self-invested personal pensions (Sipps) as the buffer we can fall back on in our retirement.

The total value of our portfolios has already dropped around 10 per cent since the conflict began. 

While we don’t need the money immediately, we are getting to that age where big stock market drops look rather scary as we may need to start using the capital over the coming years - particularly if one - or both of us stop working.

So should we sell some of our investments? If so, what should we do with the money? Keep it in cash, or leave it in the Sipp but divert it to other investments that are better suited to an uncertain world? What about putting it in gold or silver?

Ed Magnus of This is Money replies: Your wife won't be alone in worrying about whether now is the right time to sell off investments in your Sipp.

It can feel scary to watch your retirement fund dropping in value in such a short space of time.

The war in the Middle East has sent shockwaves through the markets. Every day is volatile, as a tweet or soundbite from Donald Trump moves global shares this way and that.

The FTSE 100 index remains around five to six per cent down on where it was when the conflict began.

These losses have been mirrored across the US, Europe and Asia as stock markets around the world have slammed into reverse. 

Markets behaved similarly in the immediate aftermath of the Russian invasion of Ukraine in early 2022, which sparked fears of global supply chain shocks.

But you may be thinking back even further to previous stock market crashes and wondering whether to get out before things get really bad. 

During the last global crash in 2008, the FTSE 100 index fell 47 per cent between October 2007 and March 2009.

But that was a credit crisis - in other words, the banks stopped lending and the financial system itself froze. 

This time markets are in turmoil because an inflation spike threatens to cause economic damage.

Oil and gas prices have surged since the war began with the Strait of Hormuz stalemate choking off around 20 per cent of the world's liquefied natural gas and oil supplies. 

The biggest unknown, and the main concern, for investors will be how long the conflict will last. The longer it continues, the more economic damage it is likely to inflict.

But second guessing how events will materialise is not a strategy. Often the worst possible thing to do is to make impulsive financial decisions - out of fear or anxiety of what might happen.

Unless you need to access the funds now or very soon, sometimes it's best to keep calm and carry on.

If you do decide you want to start withdrawing cash from your pension, then it's worth being mindful of a few rules.

You can usually access money in your Sipp from the age of 55, although this will rise to 57 in 2028. You can typically take up to 25 per cent of the amount built up in any pension as a tax-free lump sum, but most you can take is £268,275 unless you have what is known as a protected allowance. 

In terms of taking the rest of your pension pot, you can choose to take income from your pension while remaining invested. You could also consider taking an annuity, which is a product that gives you a guaranteed income for life or for a fixed term. This can be a useful option as they can often some security against outliving your savings.

For expert advice, we spoke to Neil Winstanley, chartered financial planner at Quilter Cheviot, Adrian Murphy, chief executive of Murphy Wealth and Mike Winstanley, director of wealth management at Bentley Reid.

Should they sell now? 

Neil Winstanley replies: It is completely understandable to feel unsettled when global events dominate the news and your pension suddenly falls by around 10 per cent. 

At your stage of life, losses feel very real because you can picture the moment you may need that money. 

But selling in the middle of a crisis can often cause more lasting damage than the drop itself. 

Markets tend to fall fastest when fear is highest and can recover just as quickly once the situation starts to stabilise. If you sell after a fall, you lock that loss in place and risk missing the rebound.

What matters more is whether your pension is still invested in a way that suits the years ahead. 

Although you are approaching 70, many people still have a retirement that will last 15 to 30 years at this point depending on health. 

That is still a meaningful time horizon, which means keeping some exposure to long‑term growth is important. 

Adrian Murphy adds: It’s important to put the events of the past couple of weeks in some context.

Whether it was the Covid-19 pandemic, Russia’s invasion of Ukraine, or ‘liberation day’ last year, there has been no shortage of events that have rocked stock markets in recent years. 

But these downturns have often been followed by periods of strong growth. The S&P 500, an index tracking leading listed firms in the US, has averaged an annual return of more than 10 per cent despite falling 20 per cent plus on many occasions.

In times like these, there are some evergreen principles that apply. Perhaps first and foremost, don’t make decisions with long-term consequences based on short-term events. 

We have no way of knowing how the situation in the Middle East will pan out. Trying to guess is tantamount to timing the market, which any seasoned investor will tell you is an almost impossible task.

How should they start selling off their investments when they do need the cash? 

Neil Winstanley replies: The bigger risk for someone around retirement age is not short‑term volatility, but having to withdraw money straight after a large market fall. This is known as sequencing risk and it can be managed.

You have several options. Some people gradually shift part of their pot into steadier investments or cash as they near retirement, rather than making a sudden move. 

If you have other savings or investments, you might draw on those first to give your pension space to recover. 

And, for some couples, working even a little longer can make a noticeable difference because it delays withdrawals and keeps retirement savings building.

If you are thinking about selling now, the key is deciding where the money would go. 

Holding everything in cash can feel safe but will struggle to keep up with inflation over the long run. 

A more balanced approach is moving part of the pot into lower‑risk funds designed to dampen volatility without cutting you off from growth. 

Gold or silver can add some diversification, but they rise and fall like any other investment and are best used in small amounts rather than as a main home for retirement savings.

A calm review of what you need, when you might need it and how you balance risk with peace of mind will serve you better than reacting to the headlines. 

The goal is a mix that helps you sleep at night while still giving your pension the chance to grow over what could be many years of retirement.

Mike Winstanley adds: The right move is to make a proper plan first, ideally with a professional adviser and involving some cash flow planning, mapping out what income they will need and when over the next decade. 

From that, the changes will become clear: keeping enough cash for the next year or two, potentially using slightly longer-term bonds that pay a healthy income as a middle layer, and then agreeing what level of risk feels right for the longer-term pot. 

Done in that order, it stops feeling like a rushed decision and starts feeling like a sensible one.

Should they look to de-risk their investments?

Mike Winstanley replies: Without knowing exactly what they hold, a 10 per cent drop is broadly in line with global equity markets since the conflict began, suggesting the portfolio is invested almost entirely in shares, with little exposure to less risky assets to provide some balance.

For someone who may need to draw on these funds in the near future, this much exposure to shares is probably too high, spreading the money across a broader range of investments and taking on a little less risk would be a sensible starting point.

If a 10 per cent fall feels genuinely frightening, it may be worth asking whether the portfolio is carrying more risk than feels right.

How can they de-risk their portfolio? 

Adrian Murphy replies: You mention other investments better suited to an uncertain world. The best hedge against that type of environment has been a well-diversified portfolio of investments, giving you exposure to different themes, markets, and asset classes. 

Gold tends to be inversely correlated to stock markets, which makes it a good diversifier - but we typically wouldn’t recommend it being any more than 10 per cent of an overall portfolio.

There's no harm in taking some risk off the table and looking at upping your exposure to bonds or other lower-risk options - particularly if the thought of falling stock markets is keeping you up at night. 

You just need to be aware the returns on these are likely to be lower, they may not keep up with inflation, and they can also fluctuate in value, as we’ve seen with gilts in the past few weeks. 

Linked to that, if you want the safety of a guaranteed income for retirement you could consider purchasing an annuity - rates are relatively attractive at the moment.

Mike Winstanley adds: Gold and silver can both add diversification, but for a couple seeking income and stability, they should only play a small role. 

Neither produces any income and precious metals have been a volatile ride this year.

Finally, if certainty matters more than flexibility, an annuity is worth exploring, though it does sacrifice flexibility for the future.

What about moving to cash? 

Adrian Murphy replies: Moving into cash could have serious implications for the longevity of your retirement fund, even in the medium term - the situation in Iran will likely stoke inflation and, in turn, reduce the purchasing power of cash.

So if you don’t already have one, I’d suggest speaking to a financial adviser about your circumstances and goals for the next few years.