One way to manage the risk of entering retirement during periods of high market valuations is to combine a reverse equity glidepath with a bucket approach. For instance, an investor can begin with 7 years of expenses in the safety bucket, providing a strong buffer when expected equity returns are low. Over time, this protection is gradually reduced to 5 years of expenses as market valuations become more reasonable. This phased reduction increases reliance on equities only when conditions improve, helping manage sequence and valuation risk.

The bucket approach makes this transition clear and practical, since protection is defined in years of expenses rather than abstract percentages.