With three decades of experience in finance, Sandra Capek offers comprehensive wealth management services. Working with clients of high net worth, Sandra Capek provides a range of estate and retirement planning strategies.
One risk as retirement approaches is being too heavily invested in equities, even though they may seem to offer the best long-term growth profile. At the same time, the potential for higher interest rates dampens expectations of lower-risk holdings such as bonds. One major miscalculation to avoid involves overestimating one's risk capacity, or the ability to sustain equity losses without substantially altering lifestyle plans.
The basic consideration is that the higher the percentage of assets invested in stocks, the smaller the amount of capital that is held in bonds, which offer a safe harbor for money in times of market turmoil. As retirement approaches, often living expenses come primarily from accumulated assets, so it is critically important to set aside a healthy mix of cash and bonds to weather ups and downs. A financial advisor can assist in assigning a recommended percentage of fixed income, to help ensure that living expenses are covered throughout the retirement years.
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