Summary
The fact is that we now have safer, higher yields. The standard deviation of fixed income is so much lower than is the case with equities. equity valuations aren’t what they once were. A 4% starting safe withdrawal rate was a good amount to anchor on.
How Withdrawals Can Influence a Retiree’s Asset Allocation. In this latest review, we came out with a conclusion that a 4% starting safe withdrawal rate was a good amount to anchor on. Treasuries and cash are really great ballast assets for equity portfolios.
High-yield looks terrible from the standpoint of adding diversification, Christine Benz says. In addition to those nominal Treasury bonds, I’d own some TIPS as well to provide that explicit inflation protection, she says. Growing that portfolio for the next generation is really the main goal.
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