Chapter 30. Build an In-Retirement Portfolio

The e-mails poured in throughout 2008 and continued into 2009. During the economic crisis and the worst bear market since the Great Depression, retirees were seeking hand-holding and guidance about what to do next.

There was Oscar, who was concerned about what would happen if his pension—which he had counted on for income during retirement—failed. How could he check up on the health of his pension, and would his retirement savings cover the shortfall in his income if his pension plan did run into problems?

I also heard from Diane—and other grown children of aging parents. An overly high stock weighting had reduced her 85-year-old mom's portfolio down to a dangerously low level, and she was trying to make sure the assets would last throughout her mother's lifetime.

And then there were Bob and Janet. Bob had moved most of the couple's assets into cash late in the bear market. That had helped them avoid a further drubbing when the market continued to sell off in early 2009, but with stocks roaring back, they found themselves in a quandary: Was it time to get back in? And if not now, when?

No doubt about it, the recent bear market tested the portfolio strategies (and nerves) of nearly all retirees, even those who were in relatively good shape at the outset and especially those who weren't.

It also demonstrated how much more challenging today's retirement landscape is than it was a few decades ago. Not only did many individuals retire with the ...

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