Russell Investments Asset Mix in Retirement
Q; What is the most appropriate asset mix in retirement? Why is it important?
A: An old standard is 100 - your age determines your equity exposure. Ie. 100- 70 would mean 30% in equities. Studies have shown that historically, a mix of 35% equity/65% fixed income is optimal from a volatility & growth standpoint or a risk and return standpoint.
Why is your asset mix important. Russell has another rule I didn't mention yesturday. The 10/30/60 Retirement Rule. Your total capital to fund your retirement is typically made up of 10% from pre-retirement money saved, 30% from pre-retirement investment earnings and 60% from post-retirement investment earnings. Given that 60% of your capital to fund your income throughout retirement is derived from post-retirement earnings,deciding on the most appropriate asset mix in retirement is vital!
A: An old standard is 100 - your age determines your equity exposure. Ie. 100- 70 would mean 30% in equities. Studies have shown that historically, a mix of 35% equity/65% fixed income is optimal from a volatility & growth standpoint or a risk and return standpoint.
Why is your asset mix important. Russell has another rule I didn't mention yesturday. The 10/30/60 Retirement Rule. Your total capital to fund your retirement is typically made up of 10% from pre-retirement money saved, 30% from pre-retirement investment earnings and 60% from post-retirement investment earnings. Given that 60% of your capital to fund your income throughout retirement is derived from post-retirement earnings,deciding on the most appropriate asset mix in retirement is vital!
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