Decumulation

The use of accumulated assets to fund retirement income or other income requirements. Where a mutual fund might be used as an asset accumulation vehicle during one’s working years, annuities enable decumulation of those assets into a stream of income during retirement.

Retirement Income Product Innovation a Possibility in Wake of Financial Crisis

The financial crisis may have one unintended consequence that would prove beneficial for millions of retirees. There is a renewed focus among providers of retirement income products in the wake of the financial crisis. The crisis has provided an opportunity for the remaining life and annuity insurers and asset managers to rethink their product offerings. The result could be a wave of innovation that is focused on retirement income and asset decumulation rather than asset accumulation and...

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Dramatic Changes in Retirement Landscape

The picture for near and current retirees has changed 180 degrees in the past couple of years. Questions such as where to retire and what do do during retirement are replaced with whether to retire and how to make sure one does not run out of money during retirement. Working longer, waiting to draw on Social Security , and understanding longevity risk are front and center for the vast majority of retirees. Decumulation or drawing sustainable income from accumulated financial assets is one of...

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Financial Crisis Will be Seen Fundamentally as a Crisis for Retirees and Near Retirees

Professor James Galbraith provided a keynote address at a recent industry conference sponsored by NAVA—the Association for Insured Retirement Solutions.

Professor Galbraith comes from the Economics department at the LBJ School of Public Affairs at the University of Texas at Austin. A Keynesian and an author most recently of The Predator State, Professor Galbraith has been a consistently strong and vocal advocate of government stimulus and intervention in response to the financial crisis.

Professor Galbraith’s basic message is that...

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Sequence of Returns Risk