Sequence of Returns
The Sequence of Return tool allows for illustrating for a client how the risk of the sequence of returns may affect the success of retirement. By applying a historical index (or blend of indexes) the illustration will show, for various start dates, the projected effects of being invested in an index with their cash balance accounts for retirement. For each given start date, the analysis displays the calculated cash balance, or the additional lump sum needed at retirement. Additionally, the analysis will include the results of changing different hypotheticals including different retirement ages, life expectancies and inflation rates.
|Under the hood, TRAK's analysis is monthly, and therefore uses the monthly rates of return for the defined historical index.