The following opinion is mine. This is a sponsored article.
Most investors dream of owning a stock portfolio that would allow them to retire comfortably. In an ideal world, you’ll live off your portfolio via a combination of dividends and capital withdrawals during your retirement. But in reality, relying solely on a stock portfolio exposes your retirement to market risks. You don’t get to choose when a bear market occurs. And the worst scenario is for you to experience retirement and a bear market at the same time. A bear market can significantly reduce your portfolio value and a fixed 4% withdrawal rate on a smaller portfolio value means you will have less money to spend – a 50% reduction in portfolio value results in a direct 50% reduction in living expenses.
