Monday, March 23, 2015

The Actuarial Approach—A Dominating Dynamic Spending Strategy

Over at The Retirement Café, Dirk Cotton has provided two informative posts which compare various spending strategies.   The first is dated February 20, 2015 entitled, “Dominated Strategies and Dynamic Spending” and the second (a follow-up to the first) is dated March 17, 2015 entitled “Dominated Strategies, Logically Unsound Strategies, Problematic Strategies and Strategies that Make Me Queasy”

In the first post, Dirk uses game theory (and not the knowledge he may have gained by avidly reading the 50 Shades of Grey trilogy) to determine that Dynamic Spending Strategies (like the Actuarial Approach) “dominate” safe withdrawal rate strategies.  In his March 17 post he continues to eliminate strategies from his “Sound Strategies” list by crossing out strategies that are logically unsound, problematic or that make him feel queasy.   Nice posts, Dirk.