How to Balance your Retirement Portfolio


This well-written article discusses the very pertinent question of how to invest in retirement. The author reviews two styles of investing. The first is putting your money in the market with the goal of obtaining a higher return and maintaining liquidity, while the second is to use guaranteed investments that keep your principal safe. The author gives some definitions and reviews the pros and cons of each method.

This is a valuable discussion and one that every investor approaching retirement should explore. From our standpoint, we agree with the author that usually by the time retirement hits, a mix of these approaches is the best fit for most people. However, depending on individual variables, someone may choose one over the other or switch from one strategy to the other as they age.

When helping clients decide how much and of which strategy to use, we do a detailed income analysis to determine the “probable” outcome of investing in the market, based on their asset level and expenses. In addition, it’s important to identify an investor’s tolerance for losses and the impact both financially and emotionally by conducting a risk analysis. Striking the right balance makes all the difference in creating a peaceful retirement.