Wade Pfau, Ph.D., CFA

Is Buying an Annuity in a Zero Interest Rate Environment a Good Idea?

By Wade Pfau, Ph.D., CFA / April 8, 2020 / Comments Off on Is Buying an Annuity in a Zero Interest Rate Environment a Good Idea?

The Federal Reserve’s decision to cut its benchmark federal funds rate from 1% to a range of 0% raises significant questions for those reassessing their retirement nest egg—a common occurrence following a dramatic selloff in equities according to resea…

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Is Buying an Annuity in a Bear Market a Good Idea?

By Wade Pfau, Ph.D., CFA / April 3, 2020 / Comments Off on Is Buying an Annuity in a Bear Market a Good Idea?

As the stock market experienced unprecedented growth over the past eleven years, many people were naturally less interested in the lifetime income options from pensions or annuities. Who wouldn’t rather have all the assets today so they can invest them…

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Adjustments For A Conservative Return Assumption

By Wade Pfau, Ph.D., CFA / April 1, 2020 / Comments Off on Adjustments For A Conservative Return Assumption

Consider three scenarios: An individual investing a lump-sum amount for thirty years An individual saving a fixed percentage of a constant inflation-adjusted salary at the end of each year over a thirty-year accumulation period An individual withdrawin…

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A Guide to a Conservative Return Assumption

By Wade Pfau, Ph.D., CFA / March 27, 2020 / Comments Off on A Guide to a Conservative Return Assumption

A simple approach for building a financial plan is to decide on a rate of return for the investment portfolio and to plug that value into a spreadsheet to represent assumed asset growth. Historical data may be used to calculate historical average retur…

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Planning For The Future – What About Bond Yields?

By Wade Pfau, Ph.D., CFA / March 24, 2020 / Comments Off on Planning For The Future – What About Bond Yields?

Adjustments for Current Bond Yields An important consideration is that current interest rates are lower than the historical averages. The historical average return is not relevant for someone seeking to estimate future market returns from today’s start…

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