Probability and the 4% rule: How to ensure your clients retire 'safely'

Probability and the 4% rule: How to ensure your clients retire 'safely'

clock

All debate about the value financial planners add for clients should have ended the moment the first helped ensure a retiree client wouldn't run out of money before they ran out of time. But doing so isn't a straightforward task, as Abraham Okusanya explains...

For clients in retirement, developing a sensible and sustainable withdrawal strategy is at least as important as developing a sensible investment strategy. Unless a client annuitises all or most of their retirement pot, they need to have a robust framework in place to guide their withdrawal decisions or risk running out of money.   The 4% rule Across the Atlantic, where retirees have had virtually unrestricted access to their retirement fund for several years, there is an extensive body of research aimed at helping financial planners and clients implement a sustainable withdrawal...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Income

What next for the income drawdown 'class of 2015'?

What next for the income drawdown 'class of 2015'?

‘Advisers know that retirement planning does not stop at retirement’

Stephen Lowe
clock 28 March 2024 • 5 min read
Retirement income advice: FCA finds 'mixed picture' among case files

Retirement income advice: FCA finds 'mixed picture' among case files

Regulator published outcome of thematic review into retirement income advice

Jenna Brown
clock 20 March 2024 • 5 min read
FCA tells IFAs to review retirement income advice processes

FCA tells IFAs to review retirement income advice processes

Comes after regulator’s thematic review of retirement income advice

Jenna Brown
clock 20 March 2024 • 2 min read