RIA — Client Plan Margin of Safety

Industry front door for margin-of-safety. Adds domain triggers, example, packs only. Parent Process unchanged. Not investment advice.

Activate when: building a retirement/decumulation plan; setting cash buffers/withdrawal rates; stress-testing a plan; client near retirement; "will they be okay if markets drop early?" Do NOT activate when: pure accumulation with long horizon and no near-term draws.

Why this variant

The parent margin-of-safety builds a buffer so estimation error doesn't cause ruin. A retiree's plan lives or dies on sequence-of-returns risk; the margin of safety is the cash/bond buffer and withdrawal haircut that lets the plan survive an early bad market.

Domain inputs → parent's Process

• Size a spending buffer (e.g. 1–3 yrs of withdrawals in cash/short bonds) so early drawdowns aren't sold at the bottom.
• Haircut the withdrawal rate below the "optimistic" number; plan to the conservative case.
• Stress-test against an early-crash sequence, not just average returns.

Worked example

$1.5M portfolio, planned 5% draw, retiring into a rich market. → Margin of safety: hold 2 years' spending in cash, set draw at 4% with a guardrail to cut in down years. A crash in year 1 is met from the buffer, not by liquidating equities low. Plan survives the sequence.