By Matthew Marcoux, CFP® / January 18th, 2021
3 Buckets in Retirement
Early on in your efforts toward retirement savings, it’s easier to accept market volatility given the potential for growth over a long period of time. When actually preparing to retire however, your mindset needs to change. You are no longer looking only for the best performing investment, but for the most consistent investment. In retirement, volatility has the potential to accelerate the depletion of your assets, especially during a declining market, and since statistics show most 65 year olds will live to be 85 or 90, you need your savings to go the distance.
We believe the key is a strategy that divides your assets into three different types of accounts: long-term aggressive, intermediate moderate income based, and short-term very conservative. With this sort of strategy, on a case-by-case, year-by-year basis, you can determine where you should actually pull money from, ensuring your retirement plan remains intact.