RetireJapan

According to Morningstar, a 4% withdrawal rate in retirement might be too optimistic. Because of lower projected stock and bond returns they're now talking about 3.3% instead, which means your investments should be 30X the amount you plan to withdraw each year.

https://www.cnbc.com/2021/11/11/the-4pe ... dated.html

fools_gold wrote: ↑Sat Nov 13, 2021 2:54 pm According to Morningstar, a 4% withdrawal rate in retirement might be too optimistic. Because of lower projected stock and bond returns they're now talking about 3.3% instead, which means your investments should be 30X the amount you plan to withdraw each year.

https://www.cnbc.com/2021/11/11/the-4pe ... dated.html

Here is the actual paper: https://www.morningstar.com/content/dam ... tent=32633

Asset allocation is an important part of this equation. Most of these formulas are based on a 60/40 portfolio. Pensions, annuities, and real estate and REIT funds are not taken into account.

One could up their equity allocation, and remain at 4% theoretically.

I'm planning to use a set withdrawal percentage and not increase it with inflation.

We'll monitor and adjust according to circumstances though.

EmaxisSlim Cultist wrote: ↑Sun Nov 14, 2021 12:59 am One could up their equity allocation, and remain at 4% theoretically.

Because stocks are more volatile, safe withdrawal rates are actually lower for higher equity allocations.

My plan is to have a cash buffer and use a flexible withdrawal strategy.