Research Affiliates – Retirement Planning: Millennials vs. Boomers

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Research Affiliates – Retirement Planning: Millennials vs. Boomers

Retirement Planning: Millennials vs. Boomers by Research Affiliates

In a recent piece from Research Affiliates, Rob Arnott and Lillian Wu  wrote that young workers are more likely than older ones to lose their jobs in an economic downturn. They are also prone to draw on their 401(k) plan to meet basic living expenses while they are unemployed. Given these facts, the early-phase concentration in equities—whose market prices are roughly correlated with the business cycle—makes target-date funds (TDFs) inordinately risky for young investors. A starter portfolio invested equally in mainstream stocks, mainstream bonds, and diversifying inflatio