Retirement income management boils down to basically two schools of thought … Probability Based School and the Safety First School. Wade Pfau has a summary on his blog, and I’ve written on the comparisons as well. Wade is an advocate of the Safety First School in general while I’m an advocate of the Probability Based […]
Nervous retirees often worry that they might lose everything in a volatile market. Yes, if you only own one stock, you could lose it all. But if your portfolio is diversified, the majority of it remains stable like the water beneath the waves. Below the wave height line, much of the water is undisturbed. Lots […]
Michael Kitces wrote an interesting article comparing “Decision Rules” vs. Rebalancing. He finds that rebalancing under a total return approach has essentially the same results using the “Safe Withdrawal Rate” (SWR) decision rules. I posted a blog a short time ago that compares the SWR approach to a Dynamic Updating approach. I have always maintained […]
Is all of your portfolio at risk of loss during a down market? It shouldn’t be if it is properly diversifiedª. Let me explain using ocean waves to represent a portfolio. You see a properly diversified portfolio would mean that ALL of your stocks and ALL of your bonds have simultaneously gone to zero value! […]
How much can you spend in retirement? How might you get more comfortable with uncertainty in retirement? Two age-old questions that should be given more attention than most people do. The first article below answers the first question above. The second article below answers the second question above. Rather than go into detail here – please […]
I recently attended an academic research conference for the Academy of Financial Services (AFS). I had the great pleasure of visiting with Wade Pfau, David Blanchett, Michael Kitces and Joe Tomlinson as well as the attending academics from the various universities across the country researching many aspects of personal financial planning. This article will discuss a few observations I made from […]
Market cycles make predictions hard for those who like to make such predictions. I believe predictions are impossible, especially over the rest of your life when it comes to retirement. This doesn’t mean we all throw up our hands though. It means taking a measure of what is prudent based on facts as we know […]
This article is a brief summary of how all of our * research papers tie together to modernize the retirement income measurement from your investments. In other words, how to determine a prudent amount of retirement income. Advisers generally annually update plans with their clients. An important part of this update process is capturing new […]
Most people are familiar with the “4% Rule.” This post is not going to debate or debunk it. What the rule essentially does is start retirement out with conservative spending, and possibly end up with lots of money at the end. What I’ll do instead is demonstrate a method that closely monitors what you’re doing each […]
When it comes to retirement income, how long does that income need to last? Can you just look at this once and then forget about it? The article below will explain why this is important and how longevity slowly changes (it gets shorter) as you age … BUT … that end age slowly gets older […]
