The Risk of Retiring at the Wrong Time

Perhaps the most appealing feature of a pension is its guaranteed income for life, no matter when you retire or what happens in the market. Unfortunately, the same is not true of 401(k) and IRA rollovers. You can retire at the wrong time. Consider two different retirement portfolios: each starting with $500,000, invested in 60% stocks/40% bonds, and withdrawing $25,000 in annual income, adjusted each year for inflation.

The only difference?  Investor A retired at the wrong Time.
	Investor A: 30-Year Period ending 1995				Investor B: 30-Year Period Ending 2005
Age	Year	ROR	Year-End Value		Year	ROR	Year-End Value
65	1966	-5.3%	$449,709		1976	20.9%	$574,111
66	1967	12.8%	$478,107		1977	-5.5%	$517,139
67	1968	7.3%	$484,049		1978	2.1%	$498,363
68	1969	-8.0%	$418,795		1979	9.4%	$509,115
69	1970	9.4%	$429,788		1980	15.2%	$543,996
70	1971	12.7%	$443,879		1981	-1.5%	$496,227
71	1972	13.6%	$467,416		1982	29.3%	$587,449
72	1973	-9.8%	$389,765		1983	13.5%	$617,562
73	1974	-15.2%	$297,166		1984	9.5%	$626,730
74	1975	23.3%	$314,422		1985	30.7%	$757,961
75	1976	20.9%	$326,575		1986	24.1%	$881,527
76	1977	-5.5%	$263,924		1987	0.4%	$835,566
77	1978	2.1%	$216,966		1988	13.5%	$889,730
78	1979	9.4%	$173,583		1989	27.8%	$1,067,888
79	1980	15.2%	$124,468		1990	0.3%	$1,013,459
80	1981	-1.5%	$52,261		1991	25.1%	$1,193,724
81	1982	29.3%	Exhausted		1992	8.9%	$1,234,005
82	1983	13.5%	-		1993	14.0%	$1,334,840
83	1984	9.5%	-		1994	-3.7%	$1,223,213
84	1985	30.7%	-		1995	35.3%	$1,566,115
85	1986	24.1%	-		1996	14.0%	$1,707,435
86	1987	0.4%	-		1997	25.6%	$2,057,859
87	1988	13.5%	-		1998	23.5%	$2,454,653
88	1989	27.8%	-		1999	8.9%	$2,593,091
89	1990	0.3%	-		2000	1.3%	$2,551,012
90	1991	25.1%	-		2001	-5.6%	$2,335,432
91	1992	8.9%	-		2002	-7.7%	$2,083,696
92	1993	14.0%	-		2003	17.3%	$2,351,418
93	1994	-3.7%	-		2004	8.3%	$2,458,423
94	1995	35.3%	-		2005	5.6%	$2,505,585
	Average Rate of Return	9.60%			Average Rate of Return	11.40%

This report is prepared for general circulation and is for informational purposes only. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or service. Market prices and other data may be obtained from outside sources and is not warranted as to completeness or accuracy. Any comments, statements and/or recommendations made herein do not necessarily reflect those of First Allied Securities, Inc., its subsidiaries or affiliates, and are subject to change without notice.