Making Your Nest Egg Last a Lifetime
The brief’s key findings are:
- Managing a nest egg in retirement is hard.
- People don’t know how long they will live and what asset returns to expect.
- “Rules of thumb,” such as spending either asset income only or a fixed percent of the capital each year, have significant limitations the capital each year, have significant limitations.
- To minimize risk, a household should consider buying an annuity to cover at least basic living expenses.