So you've got these backup sources that you could tap into if you need them (and they are part of your planning, since they are your cushion and let you sleep at night). You say you've got some discretionary spending. Given all this, why not just take your 4% at the end of each year's total? That way there's no chance of going broke, there's no market timing involved, there's no need to try to figure out how long the bad times will last. If the market does well, enjoy the money while you're young enough to really use it. If the market goes down, make your adjustments in annual withdrawal/spending early in any downturn (reducing the number of devalued shares you sell and significantly enhancing the chance of an eventual recovery of your portfolio).
Well, some of the backups I listed are still not guaranteed. I might not get a cent in SS benefits for example (I am only 33 so who knows if SS will still be there for me) and my parents could eat up their entire estate and leave me nothing (though that's very unlikely). So in those events, I may have to rely on slashing my expenses for a few years and drawing less from my portfolio. If I get both SS and inheritance, then you are right, there will be no need for me to cut my expenses and draw less than 4% of my personal portfolio each year in case of a downturn.
Last edited: