Author Topic: New article prefers rising glide path  (Read 2755 times)

lentilman

  • Stubble
  • **
  • Posts: 175
    • the Independent Penguin
New article prefers rising glide path
« on: January 13, 2014, 07:11:10 AM »
Counter to conventional advice, a new journal article (Pfau) shows that a rising stock % in retirement is preferable to alternatives.

Here is a link to the journal: http://www.fpanet.org/journal/ReducingRetirementRiskwithaRisingEquityGlidePath/

Here is a link to a a WSJ summary of the article: http://online.wsj.com/news/articles/SB10001424052702304866904579268332305015074?ru=yahoo?mod=yahoo_itp&mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702304866904579268332305015074.html%3Fru%3Dyahoo%3Fmod%3Dyahoo_itp


partgypsy

  • Handlebar Stache
  • *****
  • Posts: 2351
Re: New article prefers rising glide path
« Reply #2 on: June 01, 2015, 03:36:17 PM »
I think this stuff is interesting. I'm not sure I'm sold on the rising glide path, simply because one's adversity to risk may increase, and so over one's lifetime one is having both the total amount of money in stock and percentage in stock increase over time. 

To me the ideal situation would be, once you reach retirement age, to take enough out of stocks earnings to create an  annuity that covers 70-90% of your living expenses. If you have ss, the ss+annuity giving you 80-90% of living expenses. Then leave the rest in stocks letting it ride.

slugline

  • Handlebar Stache
  • *****
  • Posts: 1147
  • Location: Houston, TX USA
Re: New article prefers rising glide path
« Reply #3 on: June 01, 2015, 03:46:20 PM »
I think I need more explanation. I'm not sold yet on the "U-shaped glide path." Isn't that basically market timing, locking in much of your gain/loss around the time of your retirement?

nereo

  • Walrus Stache
  • *******
  • Posts: 8608
  • Location: la belle province
    • Here's how you can support science today:

slugline

  • Handlebar Stache
  • *****
  • Posts: 1147
  • Location: Houston, TX USA
Re: New article prefers rising glide path
« Reply #5 on: June 01, 2015, 03:52:39 PM »

Here is a link to a a WSJ summary of the article: http://online.wsj.com/news/articles/SB10001424052702304866904579268332305015074?ru=yahoo?mod=yahoo_itp&mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702304866904579268332305015074.html%3Fru%3Dyahoo%3Fmod%3Dyahoo_itp
arg.... any convenient way to view this WSJ article?   - it's stuck behind a paywall.

Enter the terms

What You Know About Retirement Investing Is Wrong Wall Street Journal

into a search engine, and link from there. This tactic can sneak you around many paywalls.

Eric

  • Magnum Stache
  • ******
  • Posts: 3934
  • Location: On my bike
Re: New article prefers rising glide path
« Reply #6 on: June 01, 2015, 03:53:03 PM »

neo von retorch

  • Magnum Stache
  • ******
  • Posts: 3309
  • Location: SE PA
    • Fi@retorch - personal finance tracking
Re: New article prefers rising glide path
« Reply #7 on: June 01, 2015, 03:55:32 PM »
I'd also like to see 80/20 static in that Glidepath Illusion article. i.e. Glidepath vs 50/50 vs Inverse... vs. 80/20.