A different view
A June 2011 paper published by the Putnam Institute (Putnam Investments)
called "Optimal asset allocation in retirement: A downside risk
perspective" by W. Van Harlow (Download from
lower part center column) suggests that an equity allocation of about 70% at age 65 as recommended by conventional wisdom is much too risky. The paper suggests that equities should make up < 25% of the portfolio.
Note that he uses withdrawal rates of 6-8% which is much higher than the
3-4% that convention wisdom suggests for persons planning to live 30
plus years in retirement.
May be convention wisdom is the wrong phrase but it conveyed what I want
- posted 9 years ago