2 ms·
> assuming 7% growth That's a big assumption, and doesn't take into account the reduced spending power (cost inflation) during that time.
by nathanaldensr 8y ago
> assuming 7% growth
That's a big assumption, and doesn't take into account the reduced spending power (cost inflation) during that time.
- ahelwer 8y ago7% is in line with historical growth rate (below it, actually) Cost inflation is assumed to be 3%, which is why the withdrawal rate is 4% (4% + 3% = 7%) Anyway a 4% withdrawal rate is fine for 30 years (the duration of the trinity study) but a lower withdrawal rate (say, 3.25%) is needed for longer timespans like the 65-ish years of life expected of someone just graduating college, see this: https://earlyretirementnow.com/2016/12/07/the-ultimate-guide-to-safe-withdrawal-rates-part-1-intro/ https://earlyretirementnow.com/2016/12/07/the-ultimate-guide...