quiz: you are close to retirement.. profile, principal, investment, individual

Muddahudda

Once an individual reaches the retirement stage of life, the main concern is:
A) safety of principal, with investment income being secondary.

B) reallocating financial assets to adopt a more conservative profile.

C) establishing a drawdown rate that will not result in their outliving their assets.

bboo

Hint


for people chose C, please point out where it is on notes/book?
Could not find it...



Edited 1 time(s). Last edit at Sunday, May 22, 2011 at 05:39AM by hellscream.

PalacioHill

This is in the chapter discussing human and financial capital - basically, there is no more financial capital to be earned, so therefore, establishing a drawdown rate is appropriate

Iginla2011

Would go for B though C looks close as well.

pennyless

stevenevans Wrote:
-------------------------------------------------------
> This is in the chapter discussing human and
> financial capital - basically, there is no more
> financial capital to be earned, so therefore,
> establishing a drawdown rate is appropriate


Yes, the answer is C, and I have read the chapter.

But why B is wrong? Even if no more human capital, they can still own financial capital from their existing portfolio.

Valores

C - Longevity Risk, probably the risk individual clients in retirement fear the most.