Decumulation is where the greatest danger lies

People tend to focus on the accumulation phase of investing. But the decumulation phase, when you’re spending down your assets, is often more problematical. Having an adviser with specialist expertise in retirement planning is hugely beneficial.

On the face of it, wealth management and mountain climbing may seem to have little in common, but there are several similarities between the two. Both require goal setting and long-term planning. To succeed at either you need to have endurance and persistence, but also adaptability to changing conditions. And, for the vast majority of people, both require expert help.

Another similarity is that wealth management and mountain climbing both involve risk. No matter how prepared you are, things don’t always going to plan, and factors beyond your control can soon put you in jeopardy.

An interesting fact about mountain climbing is that the risk tends to be greater on the way down a mountain than on the way up. Certainly, more accidents occur in the descent than the ascent. Again, it’s the same with investing. Although most of the focus tends to be on what we call the accumulation phase — in other words, building wealth in preparation for retirement — the decumulation, or drawdown, phase is much more challenging and, yes, potentially more dangerous.

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RETIREMENT PLANNING IS YOUR RESPONSIBILITY

55% of working-age people in Britain say they don’t know enough about pensions to make the decisions they need to make for their retirement. Are you one of them? If so, How to Fund the Life you Want by Robin Powell and Jonathan Hollow is a new book that’s designed to help you.

It’s published by Bloomsbury and is primarily written for a UK audience.

It’s available to buy on Amazon, on Bookshop.org, and in all good bookshops. There’s an eBook and an audio book version as well.

What are you waiting for? Start taking responsibility for your financial future. After all, if you don’t, no one’s going to do it for you.