Sequencing Risk in 2022
So you were thinking about retiring soon but your Super has just spiralled down in value. What now?
Boomers who have earmarked retirement in the coming months or years are facing an enlightening moment of realisation that retirement may not be possible for quite some time.
Sequencing risk is a major factor when planning out retirement and preparation for this really should have started 5 years ago. Sequencing risk is the risk that you want to retire when the market is in a downturn – just as we are now. The closer any negative returns are to your retirement, the harder it can be to recover.
We have been lucky for so long that prior to COVID, we hadn’t really seen a solid downswing in the market – nor the volatility we are experiencing now. As such, many people got comfortable with the growth and felt they were immune to the losses. After such a long time of profit, it’s easy to forget that investment doesn’t always guarantee a positive return.
However, a good planner knows how to bubble wrap your retirement income to ensure your lifestyle isn’t affected during a market downturn such as this one.
It’s not too late to speak to a professional and get an understanding of bubble wrapping your retirement income and creating a plan that will get you out of your 9 to 5 work life – it may even be possible sooner than you currently anticipate!
To speak to one of our Control Finance experts, by calling us on 03 9067 7990 today!