Retirees Can't Afford to Underestimate Sequence of Return Risk
by T. Eric Reich, CIMA®, CFP®, CLU®, ChFC®, President and Founder, Reich Asset Management, LLC
Jan 03, 2020
3 minutes
Sequence of return risk, in my opinion, may be the biggest risk retirees face.
So, what is sequence of returns? It's the order in which you get the returns that your investments receive. Why is this so important? Before retirement, it doesn't matter what order your returns come in. The end result is the exact same number. But look at what happens when I take withdrawals from the accounts in the example below:
1 | (-30%) | 25% |
2 | 5% |
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