Sequence of Returns

If you were going to hire a guide to scale a particularly high summit what would be your number one goal? Reaching the apex? What about a safe a secure descent? Real life shows us that most climbers are injured coming down the mountain. Either from lack of food and water or injury.

Financial and retirement planning is much the same. We tend to spend significant time planning and saving without really thinking of the best method to “take” these funds. While working and saving we have co-workers, friends, and financial professionals to assist with decision making. Without sound advice and planning, location and timing of pulling funds can have a direct impact on deteriorating the amount of Social Security taxation and cost of Medicare Part B premiums.

Have you heard the term “sequence of returns”? If not let’s set up a time to review and discuss your exposure to this pitfall. Having retirement dollars exposed to market risk while pulling income could be a very costly mistake in later years. Required Minimum Distributions (RMDs) are especially risky since the individual has little discretion in taking these funds. These issues and others could significantly reduce the longevity of your funds. Thereby causing you harm as you descend the retirement mountain. Let’s visit about trip planning!


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