New Improved 4% SWR

[W2R]

I like your method, UncleMick! Especially the "pssst... Wellesley" SEC yield part.

[walkinwood]

Quote:

Originally Posted by Rich_in_Tampa I don't quite see it that way. The ER simply gets reflectedd in the value of the funds, upon which the withdrawal amount is calculated. A high ER fund will have a lower end-of-year value than an otherwise identical low ER fund. But, hey, do whatever works for you.

Rich,
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.

[Rich_by_the_Bay]

Quote:

Originally Posted by walkinwood Rich, 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.