When you determine your retirement income needs, you make your projections based on the type of lifestyle you plan to have and the desired timing of your retirement. However, you may find that reality is not in sync with your projections, and it looks like your retirement income will be insufficient to meet your estimated expenses during retirement. This is called a projected income shortfall.
Conventional wisdom says that what goes up must come down. But even if you view market volatility as a normal occurrence, it can be tough to handle when your money is at stake. Though there's no foolproof way to handle the ups and downs of the stock market, the following common-sense tips can help.
It is only wise to consider what Medicare won’t cover in the future.
As the market continues its upward rise, we believe the emphasis we place on our managers holding cash makes more sense than ever. With most Mutual Funds lagging the S&P 500 Index for 10 years, we feel it is important to go against the crowd. For example only 3% of the 7,500 U.S. equity funds tracked by S&P Capital IQ recently had cash positions of 10% or higher, while 97% were almost fully invested.
When hiring active managers, some advisors look for the star rating on Morningstar rather than using the criteria TRG recommends. We believe that advisors and investors should focus on active managers who skillfully allocate capital to their best investment ideas. Passive investment options are widely available to investors who want market returns with low fees. Active managers must add value and act in clients’ best interests by allocating capital to attractive investments to increase risk-adjusted returns and justify fees. We propose an alternative method to the Morningstar rating system that we believe provides structure that protects downside while maintaining significant performance upside.
The 4% rule has received a lot of attention recently, as recent market woes of the past 18 years – from the tech crash of 2000 to the global financial crisis of 2008 – have pressured both market returns and increased volatility in the portfolios of retirees.