Sequence-of-Returns Risk

When returns happen
can change the outcome.

The order of gains and losses matters when money is moving into or out of a portfolio—especially during retirement withdrawals.

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THE PATH MATTERS

The same average is not the whole story.

Without cash flows, changing the order of an identical set of returns does not change their compounded product. But withdrawals change the amount exposed to later returns. A decline early in retirement, combined with withdrawals, can leave less available for recovery.

That is why planning for income involves more than selecting an expected average return. The timing of spending, available reserves, and dependable income sources deserve attention.

Consider the levers in your plan.

Spending flexibility

Review which expenses are essential and which could be adjusted during a difficult period.

Accessible reserves

Consider resources available to meet near-term needs without forced sales or surrender charges.

Income coordination

Evaluate existing Social Security, pensions, and any appropriate contractual income features alongside other assets.

Risk management is a balance.

Reducing exposure to one risk can increase another, such as inflation risk, liquidity restrictions, or opportunity cost. An annuity may be one tool to evaluate, but it is not appropriate for every person or every dollar.

An annuity doesn’t have to be your whole retirement plan. Some people may have no appropriate annuity need. Others may benefit from a modest protected-income allocation. Someone else may have a larger income-planning need.

There is no universal percentage. The decision depends on your income, expenses, assets, liabilities, debt, time horizon, liquidity, risk tolerance, retirement and legacy goals, health and longevity considerations, and existing resources such as Social Security, pensions, and other investments.

YOUR GOALS. YOUR NEEDS. OUR FOCUS.

Your next chapter starts with a conversation.

Tell us what matters to you. We’ll begin with your goals, your needs, and the questions on your mind.