Originally Posted by walkinwood
I'm simply re-stating what Bob Clyatt says in his book. He tested the 4%/95% scheme using index values - not real funds. So, he says you need to include your fund expenses in the amount you withdraw.
Gotcha. Semantics - my planning routine looks at returns after expenses for mutual funds including index funds. So if I think the total stock index fund will earn 7% annually, that would be after expenses, lagging a bit off the actual index holdings themselves.
I could see where back-testing would use actual index returns since expenses vary so much among funds.
San Francisco Area
ESR'd March 2010. FIRE'd January 2011.
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