I Wouldn't Want To Retire Without These Income Machines

2026-01-19 13:05:00 ET

Sequence of returns risk is probably the most underrated risk that faces retirees. This is because if you go through a prolonged period of material underperformance in your portfolio during retirement and have to liquidate shares at a deep discount to their intrinsic value, you can materially shorten your portfolio 's ability, or the number of years over which your portfolio can fund your living expenses, even if the portfolio goes on to outperform at other times. Put differently, it would be like a six-foot-tall person drowning while trying to cross a river that was only four feet deep on average because there was a 20-foot-long span where the river was 10 feet deep, and he was unable to swim....

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