Retirees Risk 62.1-Point Return Gap by Holding Too Much Cash
Updated
Updated · AOL · Aug 14
Retirees Risk 62.1-Point Return Gap by Holding Too Much Cash
3 articles · Updated · AOL · Aug 14
Summary
Barclays found cash lost 40.5% of its real value over 20 years, while an illustrative diversified portfolio gained 21.6%, showing how excess retirement cash can quietly shrink savings.
June consumer prices were 3.5% higher than a year earlier, meaning cash that appears stable in dollar terms can still lose purchasing power when interest and after-tax returns lag inflation.
Schroders' 2026 survey showed 90% of retirees worry inflation will erode savings and 68% fear outliving their money, reinforcing how safety-driven cash hoarding can create longevity risk.
Experts still say cash has a role for near-term bills, emergencies and planned purchases, but common guidelines suggest roughly six months to one year of expenses or 2% to 10% of a portfolio.