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My mother is considering retirement within the next 12 to 18 months. She is concerned about whether she has enough to retire and how her assets should be allocated. She is in relatively good health. She tends to be a bit conservative and feels that she should put the majority of her assets in fixed income vehicles. I argue that since she is in good health she should still keep a significant portion of her portfolio in the market, perhaps an index fund.

Also, when calculating a net figure that the retiree will be drawing from, is the assumption made that the future value of this sum will be $0? I have taken intro finance courses where we were given problems regarding the "time value of money" where we were asked to solve for the amount needed for a person at retirement when we knew the "salary", in current dollars, the assumed rate of inflation, the assumed rate of return, and the assumed life expectancy. And, in each of these problems it was assumed that the person would plan to save an amount that they would eventually exhaust by the time they died. Does this seem correct? I would appreciate any feedback the community has regarding asset allocation for those ready to retire. Thanks.

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