What I mean is, is swr calculated on your nest egg by including the interest, dividends & capital gains you make on your money annually or before taking that into account?
For example: if I have 2 million in my nest egg, and I'm retiring next year, what is my swr based on? Say I want a 3% swr, and I retire at the after 12 mos more of work. During that 12 mos my 2 million kicked off a 4% return, adding 80k to my total.
So, do I take 3% of 2mil? Or 3% of 2,080,000?
Hope this question makes sense. For example, if I just lived off the dividends, interest and capital gains from my portfolio, does that mean my swr is 0% since I'm only taking what the portfolio is kicking off and never taking from the principal?
I'm confused on this issue. Thanks
For example: if I have 2 million in my nest egg, and I'm retiring next year, what is my swr based on? Say I want a 3% swr, and I retire at the after 12 mos more of work. During that 12 mos my 2 million kicked off a 4% return, adding 80k to my total.
So, do I take 3% of 2mil? Or 3% of 2,080,000?
Hope this question makes sense. For example, if I just lived off the dividends, interest and capital gains from my portfolio, does that mean my swr is 0% since I'm only taking what the portfolio is kicking off and never taking from the principal?
I'm confused on this issue. Thanks