Your Retirement Plan's Cushion Against Market Downturns
Cullen Martin explains the purpose of the Presilium Market Cushion Report, which models a 38 percent market decline and shows how long a client's current cushion could support spending before stocks would need to be sold. He notes that the average recovery period after a severe decline has been about two years, and the report is meant to build confidence rather than predict the next downturn.
Cullen Martin explains the purpose of the Presilium Market Cushion Report, which models a 38 percent market decline and shows how long a client's current cushion could support spending before stocks would need to be sold. He notes that the average recovery period after a severe decline has been about two years, and the report is meant to build confidence rather than predict the next downturn.
Key takeaways
- The Market Cushion Report models a 38 percent market decline and shows how long a portfolio could support spending without selling stocks at reduced prices.
- The average recovery period following a severe market decline over the past 50 years has been about two years.
- Retirees relying on their portfolio for income face added risk if a decline forces them to sell stocks to fund their lifestyle.
- The report's goal is not to predict the next decline, but to build confidence that a retirement plan can withstand market weakness.
Hello and thank you for taking a few minutes to learn more about your Presilium market cushion report. One of our core beliefs at Presilium is that successful investing is not about avoiding market volatility. It is about being prepared for it. Throughout history, markets have experienced wars, recessions, inflation, political uncertainty, banking crises, and countless negative headlines. Yet, despite these challenges, disciplined investors who stayed focused on the long term have been repeatedly rewarded.
When you are accumulating wealth, market declines can create opportunities. But once you are retired and relying on your portfolio to support your lifestyle, it becomes even more important to ensure your plan can withstand periods of prolonged market weakness without disrupting your goals. That is exactly why we created this report.
The purpose of your market cushion report is to help answer an important question. If we experience a significant market decline, how long can you continue meeting your spending goals without having to sell stocks at temporarily lower prices? On the left side of the report, you will see a summary of your current portfolio, including its value, investment allocation, and the amount of income your portfolio generates, regardless of market performance. We then modeled a scenario where the stock market declines by 38% and does not immediately recover. The middle section of the report shows how long your current market cushion could support your spending needs before you would need to sell stock during the downturn.
For perspective, the average recovery period following a severe market decline over the past 50 years has been approximately 2 years. Our goal is to build enough flexibility into your plan so that temporary market declines do not force temporary decisions that could negatively impact your long-term success.
Most importantly, we hope this report provides confidence: confidence that your financial plan is built to withstand uncertainty, confidence that your lifestyle and goals can continue even during difficult markets, and confidence that you have a thoughtful strategy in place long before the next market decline arrives. We look forward to reviewing your personalized market cushion report with you soon.
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