Retirement Spending Portfolio Update
Many of our users are retirees or close to retirement. For them, maintaining a steady income from investments is paramount. We have addressed this topic several times. For example, in July 8, 2013: When To Retire And Bear Market Impact On Retirement Income And Spending newsletter, we looked at how several portfolios have behaved under a retirement withdrawal strategy called Floor and Ceiling Retirement Strategy with 4 Percent Fixed Percentage. To recap, the withdrawal strategy basically withdraws 4% (adjusted with inflation) annually. But it sets a floor and ceiling how much it can withdraw every year. For more details, please refer to the original newsletter.
In the newsletter, we compared how such a spending strategy affects 5 different portfolios: 60% US stocks/40% US bonds, S&P 500 total return, SAA optimal moderate, SAA equal weight modrate and TAA moderate.
Since then, markets have advanced dramatically (at least US stocks) and it is a good time to review how these portfolios have done.
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