A Comparative Analysis of Retirement Portfolio Success Rates

Authors

  • Philip L. Cooley Trinity University, San Antonio
  • Carl M. Hubbard Trinity University, San Antonio
  • Daniel T. Walz Trinity University, San Antonio

DOI:

https://doi.org/10.61190/fsr.v12i2.4759

Keywords:

Retirement portfolio, Monte Carlo/overlapping periods, Sustainable withdrawal rates

Abstract

One of the risks faced by retirees is the possibility of outliving money saved for the retirement years. Knowing the sustainability of withdrawal rates from a portfolio, or at least the risks associaed with them, would greatly help retirees deal with this problem. Two procedures proposed to analyze the problem are Monte Carlo simulaition and the overlapping periods methodology. This study compares and contrasts the implications of these two procedures for sustainable withdrawal rates from a retirement portfolio. Under some conditions, the procedures produce similar results, but in others the differences are quite large.

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Published

2003-06-30

Issue

Vol. 12 No. 2 (2003): FSR Summer 2003

Section

New Original Submission

License

Copyright (c) 2003 Academy of Financial Services

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This license allows the author to remix, tweak, and build upon the original work non-commercially. The new work(s) must be non-commercial and acknowledge the original work.

How to Cite

A Comparative Analysis of Retirement Portfolio Success Rates. (2003). Financial Services Review, 12(2), 115-128. https://doi.org/10.61190/fsr.v12i2.4759