From a behavioral standpoint, the more volatile a portfolio, the more likely the client is to suffer severe losses and the more likely they will panic. Even in the absence of a dire market environment, the “normal” volatility can cause clients to lose a lot of sleep. 

The PV number derived from Social Security is simply not likely to counteract their concern. Many people can’t conceptualize present value in the first place. Moreover most people will only relate to Social Security as a monthly check. 

You tell your client “Yes, the account is down X percent, but your Social Security is worth $200,000 by our estimates so you are not really down by that much.” 

My guess is the response will be a combination of, “What are you smoking?” and “Fine, give me my $200,000.”

Their attorney might not like your response, either.

From a portfolio management standpoint, an all-equity portfolio eliminates rebalancing. With little or no cash and fixed income, instead of buying when prices have dropped, the client has to just sit and take it. This can make the client feel helpless and increases the chance they will panic out of the markets. 

Mathematically, the added volatility is often not worth the additional risk. It is not uncommon to run Monte Carlo simulations and find that while very aggressive portfolios have higher expected returns over long periods of time, the client's success rate does not improve markedly or at all. 

Higher volatility means more frequent and more severe declines. A deeper look at the simulations often reveals that the volatility causes failures to appear earlier. More frequent and severe losses from an aggressive portfolio increase the odds that, to avoid failure, clients will need to make spending cuts, sooner and deeper than they would have had to otherwise. 

No. Social Security should not be treated as a bond. The payments are received for life, not a specific term. Payments are increased to offset the higher cost of living over time.

For a married couple, payments are reduced but continue for the life of the widow or widower and cease upon the widow/er’s death.