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Exploring Glide Paths in Investment Strategies for Retirement Planning
This chapter delves into the concept of glide paths in investment strategies, particularly focusing on how equity allocation changes with age in retirement plans through target date funds. It discusses the rationale behind declining glide paths, post-retirement glide paths, and optimal portfolio allocation after retirement. The chapter also examines a data-driven analysis of historical financial data to simulate 60-year retirements for different cohorts and contrasts traditional safe withdrawal rate approaches with newer methods to maximize portfolio performance during retirement.