Although longevity risk can pose a serious threat to your retirement plans, its impact can be mitigated with prudent planning and using reasonable assumptions for how long you and your spouse may live.
Diversification can only lower your risk to a certain extent, regardless of the number of investments you own. However, what does not decrease, as your holdings increase is complexity.
Often, adding complexity (your portfolio) on top of complexity (the markets) can increase risks rather than reduce them.
The company-specific risk that comes with concentrated holdings can be mitigated through diversification. However, the process of selling can have many nuances. Having a diversification strategy in place could be useful when making investment decisions with tax and emotional implications.
Some of these retirement milestones create potential planning opportunities to boost savings, maximize retirement income, or improve tax efficiency. Others mark deadlines that could result in stiff penalties if overlooked.
Something went wrong. Please refresh the page and/or try again.