Retirement risk pillar
Fort Knox Market & sequence risk
Sequence risk is about when returns show up, not just how large they are. Early drawdowns can break a retirement plan even if long-run averages look fine. We model drawdown sensitivity, withdrawal rules, and location-driven cost demands—without advice or sales pressure. This view emphasizes signals and scoring context for Fort Knox, KY.
What drives this risk
We focus on directional, data-backed signals. No advice, no guarantees. The goal is to surface where this pillar can derail a plan so you can adjust with clarity.
Sequence-of-returns exposure
Drawdowns in the first 5–10 years after retirement have an outsized impact on portfolio survival.
Portfolio mix vs volatility
Equity/bond mix, factor tilts, and concentration change downside risk and recovery speed.
Withdrawal rules and guardrails
Fixed vs flexible withdrawals, COLA adjustments, and dynamic rules affect how shocks propagate.
Cash buffers and buckets
Cash reserves or near-cash ladders can reduce the need to sell into drawdowns.
Location-driven costs
State + city tax, housing, and insurance volatility shape how much you must withdraw in stress periods.
Data sources we use
- • Market return histories and drawdown stats
- • BLS CPI and regional inflation for real spending adjustments
- • State tax policy and brackets affecting after-tax withdrawals
- • Housing/insurance trend data for location-specific cost spikes
How it shows up in your score
Early drawdown stress
The first decade of retirement is where sequence risk bites hardest. Cash buffers and flexible withdrawals can keep your score lower.
Portfolio mix
Volatile or concentrated portfolios lift your sequence risk score. Diversification and clear spending rules ease the pressure.
Spending demands
High taxes, housing, or insurance costs force larger withdrawals during stress years. Your local cost load feeds directly into this score.
Flexibility signals
Cash buffers, bucket strategies, or flexible COLA adjustments show resilience. More flexibility usually means a lower score here.
What you can do here
- • Run the assessment to see your preliminary market/sequence sub-score.
- • Explore state pages for location-driven cost pressure affecting withdrawals.
- • Use scenario pivots (coming) to test different withdrawal and buffer strategies.
Educational only. No advice or sales—any future referrals remain opt-in.
Explainer
Why market & sequence risk matters to you
Timing matters: a bad market in your first decade of retirement can derail a plan even if long-run averages look fine. Your score weights early-sequence stress and local cost pressure.
Your score uses unemployment-rate volatility as a public proxy for local economic shocks that often coincide with market stress and higher withdrawals.
Signals we consider
- • Volatility proxy: 10-year std dev of unemployment rate (BLS LAUS) by state/county.
- • Early decade focus: Drawdowns near retirement hurt most; location costs drive withdrawal pressure.
- • Buffers + flexibility: Cash reserves and COLA flexibility can lower risk in high-volatility locations.
FAQs
- Why does my score use unemployment volatility? — Local unemployment spikes often coincide with market stress and higher withdrawal needs; it’s a public, defensible proxy.
- Can I lower sequence risk without moving? — Yes. Larger buffers, flexible withdrawals, and spending aligned with local cost volatility can reduce sequence pressure.