I am already Retired.  Do I need a retirement plan?

Yes, retirement planning is an ongoing activity (annually is most cases) that has three general stages; the accumulation stage, pre-retirement planning, and post retirement planning.  With the majority of individuals still intending to retire at 65 it is not unrealistic for them to be retired for a 30 year period.  Without earning any employment income during this period, optimum asset management is even more important than during the other planning stages.  This is especially true when you consider the impact ongoing, changing, and future expense and inflation will have on the retirees resources.

What is reverse-dollar-cost-averaging?
It is withdrawing income from your investments on a periodic basis. This is the opposite of dollar-cost-averaging; contributing to your investments on a periodic basis.  Dollar-cost-averaging contributes to wealth creation because it takes advantage of price fluctuations.

However, reverse-dollar-cost-averaging is the opposite and works against you. This occurs because once you sell part of your investment for the necessary periodic income, especially if it is during a declined market, then your losses are permanent. When the market comes back, you no longer have that part of your investment to participate in the rise.

Our estimations show that for the amount of benefit received from dollar-cost averaging in a bear market, that the reverse- dollar-cost-averaging has an amount about three times as much in detriment for the same bear market.  There are three things that can be done to minimize the negative impact of reverse dollar cost averaging.  

1. Always take your income from the least volatile investments, such as money market, 
2. Do not re-balance more often than what is required for an optimum portfolio.