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Sequence of returns risk is one of the most important — and often overlooked — risks for investors approaching or entering retirement. Understanding how the timing of market gains and losses impacts your withdrawals can make a significant difference in how long your assets last.
00:04 Introduction to retirement nest egg duration
00:12 Defining sequence of returns
00:24 Example setup: $500,000 retirement fund
00:40 First scenario: Starting with positive returns
01:01 Result: 34 years of income
01:08 Second scenario: Starting with negative returns
01:41 Impact: Loss of 11 years of retirement income
02:08 Solutions for managing sequence of returns risk
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