Allocation During Retirement: Adding Annuities to the Mix
by William Reichenstein
A retirees portfolio is not quite the same as the portfolio of an individual saving for retirement, because typically a retiree is withdrawing from his portfolio. The focus of the research has been how various asset allocation strategies can affect those withdrawals—specifically, which mixes will ensure a withdrawal rate that is both high but also sustainable over the retirees lifetime.
In this article
- What is Annuitization?
- Pros & Cons of Annuitizing: An Example
- Historical Experience
- Today Versus History
- Should You Annuitize?
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Until recently, most of the research has centered on the basic asset categories of cash, bonds and stock, and some of the more popular subcategories—for instance, small-cap stocks, value stocks, etc.
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