If you read a lot about retirement you have no doubt come across established thinking that asks you to follow the so-called 4% rule and to choose a Social Security start date after conducting a break-even analysis.
These well-recognized strategies may have problems. Let’s take a closer look.
Deciding to draw down retirement assets using the 4% rule
Most people have heard that withdrawing 4% of your portfolio each year of retirement (adjusted for inflation) is an excellent way to make sure you don’t run out of money before you die. Ironically, this withdrawal rate was revised by its creator shortly after it was published to be not 4%, but 4.5%, when a more realistic mix of stock and bond investments is used. Nonetheless, people insist on using 4% (or less if you look at some recent research) as the number as though it was handed down from Mount Sinai on a stone tablet.
Read more: https://www.marketwatch.com/story/beware-conventional-wisdom-when-planning-for-retirement-2018-09-05