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Staying in equities and embracing their risk and potential return just might make sense for some retirees.
Older investors with a combination of pension income, Social Security benefits and income annuities have a measure of safety in retirement.
“If you have a big pension and Social Security, maybe you have the ability to take more risk than you think,” said Alex Brusda, chartered financial analyst and portfolio manager at North Star Asset Management. The Neenah, Wisconsin-based firm ranked fifth on the CNBC FA 100 list.
“Yes, short term they are risky, but as the time horizon increases, that market volatility goes down,” he said.
“If you’re saving in the long-term, knowing that might make clients more willing to own stocks and increase their allocation.
Why more stocks
There are a number of reasons why it might make sense for a retiree to ramp up equity risk.
For instance, a judicious increase in stock allocation might be worth considering if low interest…