Many Retirees Don’t Know About This Major Market Risk: Do You?

Flat market cycles can wreak havoc on your retirement planning. Here’s why you shouldn’t focus only on average returns.

An older man looks at paperwork with a concerned look on his face.
(Image credit: Getty Images)

It is common to meet someone who believes that all of their assets should be in equities, even in retirement. The rationale is that, over the long term, equities tend to be one of the best places for growth, which is true. However, these claims often point to long-term averages, which, when you dive a little deeper into the application, can be misleading.

This article is intended to address two major arguments. The first is that averages are a great tool to use when you are planning your retirement, but there’s more that needs to be addressed. The second is that the markets have a history of going flat for 10-plus years every 20 years or so, which can create some serious problems in retirement.

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Mike Decker, NSSA®
Author, Wealth Planner and Money Manager, Kedrec LLC

Mike Decker is the author of the book How to Retire on Time, creator of the Functional Wealth Protocol, and the founder of Kedrec, a Registered Investment Advisory firm located in Kansas that specializes in comprehensive wealth planning and management at a flat fee. He specializes in creating retirement plans designed to last longer than you™, without annuitized income streams or stock/bond portfolios. In addition to helping people achieve their financial goals, Decker continues to act as a national coach to other financial advisers and frequently contributes to nationally recognized publications.