Chaos and Retirement Income

16 Pages Posted: 31 Jan 2020

Date Written: December 1, 2019


When the media, academics, and politicians tout investment strategies such as indexing as universal truths without distinguishing between wealth accumulation and distribution, they promote strategies that are dangerous to retirees’ life savings. Accumulating wealth is a linear process, but taking withdrawals from a portfolio injects nonlinearity. Chaos theory, which focuses on nonlinear processes such as retirement income, is key to understanding why and how the rules of portfolio management change from pre- to post-retirement. This understanding is the basis for creating safer portfolios for retirees. Chaos theory is also the basis for making retirement income simpler and more personalized because it allows us to see what to pay attention to and what to ignore.

Keywords: retirement income, retirement planning

JEL Classification: G10, G11

Suggested Citation

Sandidge, James, Chaos and Retirement Income (December 1, 2019). Retirement Management Journal, Vol. 8, No. 1, 2019, pp. 17-30, Available at SSRN:

James Sandidge (Contact Author)

The Sandidge Group ( email )

Belmar, NJ 07746
United States
908-472-4175 (Phone)

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