3 ms·
I've recently heard some criticism of the 4% rule. It's designed with two assumptions: that you are old, and that when you die there may be basically nothing le
by im3w1l 5y ago
I've recently heard some criticism of the 4% rule. It's designed with two assumptions: that you are old, and that when you die there may be basically nothing left. So it only needs to last around 30 years give or take. But if you retire at 30 with a strategy that runs out in 30 years that could be an issue.
But on the other hand I do believe you can prevent blowing up if you are willing to live lean when the economy is doing bad (the standard assumption is that you keep increasing your spending in line with inflation even as your portfolio craters).
- h-w 5y agoThe 4% rule is pretty generic. But if 2.5-3% will cover your expenses, statistically that will never run out no matter how long you live.
- jleyank 5y agoQuite agree - good point. In other words, 2m isn’t that much of a pile to put up against Father Time. Perhaps choose to use your fuck you money to go somewhere you like to do something you like. Work isn’t bad when it’s enjoyable or worth doing.