Still River has released the third in its series of retirement planning papers, "Retirement Income Planning, Part 3: Risk and Investment Strategy for Retirees." The paper concludes that, despite the recent hype promoting growth investing for retirees, a conservative investment strategy may still be best.

The problem is that the assumptions behind the advice to increase risk are faulty, the paper says. "Inflation is not as important after retirement as it is before retirement," because many expenses decline as individuals age and are no longer able to go out to eat, buy clothing and travel. The paper states that spending generally stays flat after a person reaches their early 80s.

Therefore, the risk associated with a more aggressive portfolio is generally not worth it. While a strategy that has an equity/bond mix can result in greater assets at death, most retirees do not place as high a priority on leaving an estate as they do on living a comfortable – and stress-free – lifestyle during retirement.

The two earlier papers are " What People Want" and " A Realistic Comprehensive Planning Model."

Still River is in the process of developing a retirement planning system that simplifies the data collection process, immediately responds to retirees’ questions and provides a complete plan. The first prototype is slated to come out in early 2005.

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