Nothing new here really, but it is kind of interesting to see how the numbers might play out in real life. Here they assume somebody retires in 1979 100% invested in S&P 500 stocks. At a 4.5% withdrawal rate their portfolio grows nicely and they end up in 2008 with a substantial nest egg. If you reverse the order of returns, however (still getting the same average 10.99% return in that 30 year period) the portfolio runs out of money after 13 years, because of the down years at the beginning of the distribution period. Kind of scary, but I guess it shows the importance of diversifying assets and not relying on a 4.5% SWR!
Investment Portfolio Strategy: Sequence of Returns Demonstrates How Market Volatility Impacts Long-Term Returns: CliftonLarsonAllen Wealth Advisors, LLC
Investment Portfolio Strategy: Sequence of Returns Demonstrates How Market Volatility Impacts Long-Term Returns: CliftonLarsonAllen Wealth Advisors, LLC