Abstract
During the financial crisis of 2007–2009, the market value of retirement assets held in stock fell by 32%. The objective of this study is to show how a severe financial crisis affects the withdrawal patterns of retirees. Specifically, the authors examine how withdrawal patterns change when an unexpected major investment shock at various years into retirement is induced artificially. The results show that equally weighted portfolio of stocks and bonds performs better than a portfolio of 100% stock, or a portfolio of 100% bonds by providing a more stable withdrawal pattern.
- © 2015 Pageant Media Ltd
Don’t have access? Register today to begin unrestricted access to our database of research.