Traditional retirement planning often relies on "Gaussian" models or average historical returns to project success.
: A retiree who experiences a major market crash in the first few years of retirement may run out of money even if the long-term average return remains high. This is because selling assets during a downturn to fund living expenses permanently depletes the portfolio's ability to recover—a concept Otar calls "reverse dollar cost averaging" . The "Luck Factor" and the Zone Strategy Unveiling The Retirement Myth
: Once you enter the distribution phase, your portfolio becomes a "wasting asset" rather than a growth asset. In this stage, the sequence of returns —the order in which you experience market gains and losses—is far more critical than long-term average returns. The "Flaw of Averages" and Sequence Risk The "Luck Factor" and the Zone Strategy :
: If the market averages 7% over 30 years, your portfolio will sustain a consistent withdrawal rate based on that average. Unveiling The Retirement Myth