Target Date Retirement

Navigator Accounts: Allocation

Summary

The Navigator Target-Date Retirement Account allocates stocks, bonds, and cash for investors already in or entering retirement. These portfolios tend to be managed to more of a conservative asset-allocation strategy. These portfolios aim to provide investors with steady current income throughout retirement. Each account is customized to meet individual goals.

Benchmark: S&P Target Date Retirement Income Index (TR)

Core Facts

Asset Class Allocation
Category Target Date
Expense Ratio [1] 0.0%
Commissions [2] 0.0%
Fee [3] 0.30%
Minimum investment [4] $1000 US
Account number ALL111
Account manager Galleon Wealth Management
Region Global
Market Developed

Portfolio composition by security (top holdings)

Top Holdings

NameAverage RiskAverage VolatilityAverage Allocation
Citadel Nontraditional Bond0.9 Moderately Aggressive4.8 High5%
Citadel World Bond0.7 Moderately Aggressive3.3 Low10%
Citadel High-Yield Bond0.7 Moderately Aggressive5.3 High15%
Citadel Preferred Stock1 Low25%
Citadel Corporate Bond25%
Citadel Intermediate Gov-1.8 Very Low20%

Performance

Our Target Date analysis utilizes Monte Carlo simulations. This simulation includes results from 5000 portfolios based on entered mean and historical asset correlations and volatility. Returns were modeled as correlated random samples from a multivariate normal distribution. The configured portfolio model had 7.31% annual mean return with 10.56% standard deviation. The simulation results are based on generated nominal returns and life expectancy based variable percentage quarter withdrawals (70-year old, Uniform Life Expectancy ). The simulated inflation model used historical inflation with 2.60% mean and 1.11% standard deviation based on the Consumer Price Index (CPI-U) data from Jan 1987 to Dec 2019. The generated inflation samples were correlated with simulated asset returns based on historical correlations. The available historical data for the simulation inputs was constrained by Total US Bond Market [Jan 1987 – Dec 2019].

This hypothetical is an example that assumes certain variables, such as initial investment, age, life expectancy, and other factors. We handle each client’s situation as unique. Talk to your investment manager to have custom simulations prepared for your specific needs and goals.

Monte Carlo Simulation      
Initial Amount$100,000
Periodic AdjustmentWithdraw based on life expectancy
Life Expectancy ModelUniform Life Expectancy (70+)
Current Age70
FrequencyQuarterly
Simulation Period25
Simulation ModelForecasted Returns
Use Full HistoryYes
Sequence of Return RiskNo Adjustments
Inflation ModelHistorical Inflation
Monte Carlo simulation results for 5000 portfolios based on entered mean and historical asset correlations and volatility.
Returns were modeled as correlated random samples from a multivariate normal distribution.
The configured portfolio model had 7.31% annual mean return with 10.56% standard deviation.
The simulation results are based on generated nominal returns and life expectancy based variable percentage quarter withdrawals (70-year old, Uniform Life Expectancy ).
The simulated inflation model used historical inflation with 2.60% mean and 1.11% standard deviation based on the Consumer Price Index (CPI-U) data from Jan 1987 to Dec 2019.
The generated inflation samples were correlated with simulated asset returns based on historical correlations.
The available historical data for the simulation inputs was constrained by Total US Bond Market [Jan 1987 - Dec 2019].
Portfolio
Asset ClassAllocationCAGRExpected Annual ReturnAnnualized Volatility
US Stock Market65.00%8.60%9.80%14.95%
Total US Bond Market35.00%2.74%2.81%3.81%
Summary Statistics
10th Percentile25th Percentile50th Percentile75th Percentile90th Percentile
Time Weighted Rate of Return (nominal)4.17%5.37%6.77%8.19%9.59%
Time Weighted Rate of Return (real)1.50%2.68%4.07%5.48%6.80%
Portfolio End Balance (nominal)$51,252$68,274$94,831$132,112$182,206
Portfolio End Balance (real)$26,932$35,844$50,164$70,118$95,564
Maximum Drawdown-64.04%-55.37%-45.40%-36.15%-29.32%
Maximum Drawdown Excluding Cashflows-29.71%-24.85%-20.72%-17.26%-14.83%
Safe Withdrawal Rate4.48%5.36%6.34%7.59%8.83%
Perpetual Withdrawal Rate1.50%2.62%3.92%5.20%6.36%
5000 portfolios out of 5000 simulated portfolios (100.00%) survived all withdrawals.
Portfolio Balances (nominal)
Year10th Percentile Balance25th Percentile Balance50th Percentile Balance75th Percentile Balance90th Percentile BalancePortfolio Success
1$90,929$96,261$102,545$109,858$116,941100.00%
2$88,684$96,078$105,247$115,597$126,394100.00%
3$87,262$96,275$108,009$121,576$134,516100.00%
4$86,041$97,032$110,635$126,173$142,224100.00%
5$85,658$97,540$113,083$131,289$149,806100.00%
6$85,489$98,050$115,236$135,685$157,594100.00%
7$84,595$98,689$117,295$140,391$165,406100.00%
8$84,428$99,274$119,261$144,145$171,690100.00%
9$82,853$99,168$120,899$147,743$178,067100.00%
10$81,485$99,384$122,258$151,278$184,147100.00%
11$80,724$98,508$123,225$153,726$190,541100.00%
12$79,669$98,241$124,149$156,404$196,317100.00%
13$78,732$97,445$124,279$158,983$201,722100.00%
14$77,563$97,240$124,260$161,261$202,624100.00%
15$75,804$95,951$124,037$161,952$205,495100.00%
16$73,486$95,480$123,213$161,919$206,622100.00%
17$72,826$92,749$122,196$161,824$209,174100.00%
18$70,677$90,971$119,857$160,809$208,633100.00%
19$68,534$89,187$117,743$158,515$208,138100.00%
20$66,142$86,552$115,113$156,039$204,387100.00%
21$64,228$83,670$113,174$153,168$204,625100.00%
22$60,814$79,815$109,503$149,949$199,209100.00%
23$57,738$75,898$105,178$145,026$191,886100.00%
24$53,972$72,264$100,481$140,024$186,962100.00%
25$51,252$68,274$94,831$132,112$182,206100.00%
Portfolio Balances (inflation adjusted)
Year10th Percentile Balance25th Percentile Balance50th Percentile Balance75th Percentile Balance90th Percentile BalancePortfolio Success
1$88,654$93,753$100,045$107,107$114,207100.00%
2$84,209$91,172$99,904$109,896$120,057100.00%
3$80,821$89,047$100,214$112,594$124,809100.00%
4$77,553$87,541$99,592$114,058$128,431100.00%
5$75,248$85,677$99,828$115,828$132,218100.00%
6$72,829$84,144$98,852$116,760$135,828100.00%
7$70,829$82,296$98,028$117,679$138,150100.00%
8$68,598$80,813$96,797$117,489$140,561100.00%
9$65,948$78,766$96,172$117,454$142,015100.00%
10$63,140$76,577$94,931$117,148$142,811100.00%
11$60,583$74,492$92,792$116,332$144,988100.00%
12$58,640$72,067$91,145$115,672$145,364100.00%
13$56,083$69,824$88,830$114,028$145,541100.00%
14$54,155$68,134$86,725$112,538$141,956100.00%
15$51,171$65,118$84,454$109,913$140,906100.00%
16$48,876$62,994$82,181$107,632$138,133100.00%
17$47,021$60,196$79,126$104,708$136,466100.00%
18$44,444$57,442$75,758$101,751$132,736100.00%
19$41,941$54,837$72,700$97,903$129,379100.00%
20$39,499$51,681$69,224$94,388$122,924100.00%
21$37,143$48,664$66,101$89,797$119,769100.00%
22$34,460$45,501$62,242$85,535$113,777100.00%
23$31,824$42,157$58,263$80,609$107,613100.00%
24$29,243$39,056$54,293$76,266$102,094100.00%
25$26,932$35,844$50,164$70,118$95,564100.00%
Portfolio Cashflows (nominal)
Year10th Percentile Cashflow25th Percentile Cashflow50th Percentile Cashflow75th Percentile Cashflow90th Percentile Cashflow
1-$3,570-$3,711-$3,875-$4,063-$4,235
2-$3,555-$3,795-$4,117-$4,465-$4,802
3-$3,615-$3,946-$4,379-$4,882-$5,344
4-$3,689-$4,119-$4,665-$5,274-$5,904
5-$3,810-$4,307-$4,947-$5,700-$6,452
6-$3,962-$4,519-$5,268-$6,168-$7,078
7-$4,086-$4,716-$5,560-$6,615-$7,721
8-$4,241-$4,927-$5,910-$7,110-$8,467
9-$4,358-$5,144-$6,265-$7,621-$9,144
10-$4,483-$5,389-$6,600-$8,099-$9,864
11-$4,612-$5,614-$6,983-$8,649-$10,635
12-$4,762-$5,845-$7,325-$9,251-$11,491
13-$4,938-$6,108-$7,752-$9,834-$12,415
14-$5,127-$6,406-$8,137-$10,482-$13,244
15-$5,276-$6,632-$8,517-$11,073-$14,066
16-$5,422-$6,871-$8,892-$11,701-$14,846
17-$5,586-$7,157-$9,337-$12,300-$15,791
18-$5,764-$7,404-$9,703-$12,970-$16,713
19-$5,933-$7,676-$10,057-$13,532-$17,624
20-$6,028-$7,894-$10,410-$14,095-$18,510
21-$6,173-$8,078-$10,803-$14,607-$19,268
22-$6,262-$8,217-$11,140-$15,180-$20,103
23-$6,299-$8,276-$11,405-$15,669-$20,786
24-$6,319-$8,307-$11,570-$16,079-$21,413
25-$6,282-$8,411-$11,644-$16,285-$21,991
Portfolio Cashflows (inflation adjusted)
Year10th Percentile Cashflow25th Percentile Cashflow50th Percentile Cashflow75th Percentile Cashflow90th Percentile Cashflow
1-$3,510-$3,652-$3,814-$3,998-$4,167
2-$3,409-$3,639-$3,944-$4,291-$4,609
3-$3,382-$3,687-$4,092-$4,567-$5,005
4-$3,364-$3,753-$4,250-$4,811-$5,398
5-$3,381-$3,819-$4,398-$5,079-$5,738
6-$3,408-$3,907-$4,564-$5,344-$6,149
7-$3,437-$3,973-$4,685-$5,606-$6,518
8-$3,467-$4,046-$4,863-$5,858-$6,937
9-$3,493-$4,123-$5,019-$6,118-$7,315
10-$3,479-$4,200-$5,173-$6,339-$7,695
11-$3,484-$4,268-$5,321-$6,602-$8,121
12-$3,536-$4,341-$5,448-$6,883-$8,529
13-$3,555-$4,416-$5,602-$7,119-$8,992
14-$3,600-$4,523-$5,743-$7,435-$9,385
15-$3,591-$4,564-$5,860-$7,627-$9,733
16-$3,605-$4,621-$5,999-$7,843-$9,961
17-$3,631-$4,660-$6,122-$8,089-$10,338
18-$3,646-$4,688-$6,177-$8,256-$10,745
19-$3,675-$4,768-$6,295-$8,439-$11,068
20-$3,642-$4,786-$6,297-$8,570-$11,258
21-$3,628-$4,754-$6,375-$8,639-$11,459
22-$3,576-$4,719-$6,401-$8,746-$11,599
23-$3,528-$4,647-$6,364-$8,787-$11,730
24-$3,416-$4,541-$6,313-$8,794-$11,731
25-$3,335-$4,436-$6,204-$8,655-$11,716
Simulated Assets - Correlations and Returns
NameUS Stock MarketTotal US Bond MarketInflationCAGRExpected Annual ReturnAnnualized Volatility
US Stock Market1.000.060.018.60%9.80%14.95%
Total US Bond Market0.061.00-0.112.74%2.81%3.81%
Inflation0.01-0.111.002.59%2.60%1.11%
Asset correlations are based on monthly returns from Jan 1987 to Dec 2019. Historical volatility is used with specified expected annual returns. CAGR is estimated from the expected mean return and volatility.