Market Risk for New Retirees and Retirement Planning
Many of our clients are in the early stages of planning for retirement and concerned with their equity market risk during their retirement years. We often advise clients to work with us to perform a comprehensive retirement income needs analysis and devise an appropriate asset allocation that will account for the potential damaging impact of a market decline at the outset of retirement. It is important that retirees balance their income needs, retirement lifestyle goals and estate plans with their investment risk tolerance at the outset of retirement rather than react to potentially sudden market developments afterwards. It is also essential to entrust the oversight of investment portfolios to a qualified investment advisor looking after the investor's best interests as emotions can sometimes overwhelm investor discretion during market downturns, particularly at vulnerable life stages like the early retirement years.
This Wall St. Journal article reviews the consequences of a market decline early in retirement and how it could effect retirees who have not taken the time to plan for such a possibility.