Stock market timing effects on individual retirement plans: All holding period returns are not ‘average’

This paper suggests a win-win approach to dealing with stock market uncertainty in the advisory role of financial planning. It gives historical examples of holding periods where the stock market returns were above and below ‘average’ as suggested by Ibbotson Associates, Inc. stock return data. Examples are used to illustrate how conservative return estimates can provide safety for individual retirement plans and more assets under management for financial advisers. Suggesting conservative planned rates of return also protects the adviser against the many ‘accountability’ lawsuits that emerge during market declines.