4 ms·
4% Retirement Rule Now 4.7%
- Bostonian 5y agoRecent historical stock market returns have been very high, but to the extent that is due to higher valuations, future returns will likely be lower. There is obviously a tradeoff between higher initial spending and a higher chance of running out of money. A Fortran simulation of spending rules assuming normally distributed returns is at https://github.com/Beliavsky/RetirementSpending https://github.com/Beliavsky/RetirementSpending . One can use the free gfortran compiler (part of gcc) to compile and run it.
- BXLE_1-1-BitIs1 5y agoI've been targeting taking ½ my portfolio gains. As the portfolio grows I can increase my withdrawals. This also builds a legacy for my kids. Portfolios go up and down; so you can adjust your withdrawals In my case, a big chunk is in Canadian Registered Retirement Income Funds. The drawback is that the entire amount is taxable income in the year you die making a big chunk taxed at the top rate. You might want to carry insurance to cover the tax hit in case of sudden demise. A diagnosis giving you a few years allows you to spread the withdrawals over your remaining time in a lower tax bracket.
- tjader 5y agoWhat do you plan to do when the portfolio loses instead of gaining?