Strategies for
distribution-stage investing
Goals-based retirement income strategies that take the guesswork out of hitting your client’s target distribution rate
The Horizon Investments goals-based wealth curve
Position your clients’ wealth to achieve their goals and manage risks at each investment stage — helping them fund a long and active retirement
STAGE
Seek to manage volatility risk and maximize capital growth
Goal:
Grow wealth
STAGE
Seek to manage drawdown risk and continue to grow assets
Goal:
Protect wealth
STAGE
Seek to minimize shortfall risk and consistently generate income desired
Goal:
Spend wealth (distribution)
Risk:
Longevity
Strategy:
Real Spend®
Objectives:
- Target exposure to global equity and fixed income markets
- Mitigate unrecoverable losses during turbulent periods
For illustrative purposes only.
What if you had a better way to generate income while making wealth last?
Retirees are living longer, maintaining robust lifestyles, and seeking to leave a legacy for the people and causes they care about. To reach investors’ goals, we believe modern retirement income solutions must prioritize both asset preservation and capital growth.
Real Spend® is engineered to strike this balance.
The strategy automatically shifts assets from the equity portion of the portfolio to a spending reserve, to support your client’s desired distribution or spend rate.
BENEFITS
Don’t leave your bucket strategy to chance or let clients run out of money
Allocate to equities across investment stages
We believe equities are the most effective asset class for helping investors achieve their goals throughout their lives. Horizon Investments’ focus on distribution-stage equity investment is designed to:
- Drive returns to grow and sustain retirement portfolios
- Generate income, especially in a low-rate environment
Automate and scale your bucket strategy
Using Horizon’s investment planning software you can easily determine your client’s target distribution rate, select the Spend portfolio designed to hit that rate, and run different scenarios to measure the likelihood of success.
ADVANTAGES
Traditional retirement income solutions may not be enough
A fixed income tilt can be a recipe for underfunding retirement
The typical approach — tilting to a conservative fixed income portfolio as clients enter retirement and focusing on asset preservation as investors spend down — may not be enough to fund retirement and legacy goals, especially in a long-term low-rate environment.
Traditional bucketing can be inefficient and imprecise
Requiring complex spreadsheets and a huge amount of effort, scaling a manual bucketing approach across all of your clients can be near-impossible.
Horizon retirement Portfolios
Five retirement portfolios designed to meet varying distribution targets for Spend-stage investors
79% equity
0% fixed income
21% spending reserve
74% equity
8% fixed income
18% spending reserve
68% equity
17% fixed income
15% spending reserve
62% equity
26% fixed income
12% spending reserve
55% equity
36% fixed income
9% spending reserve
For illustrative purposes only
