For retirees who plan to live off a combination of pension, social security and dividend payouts from retirement accounts, never touching the retirement account principal, does the 4% rule really matter?
I understand that retirees may end up touching principal on years of negative market returns or if the promised pension never materialises or abruptly stops, if Social security goes bankrupt, or they end needing intensive care but have no LTC insurance etc.
But if none of these things happen, does "withdrawing rate" still matter?
I understand that not reinvesting dividends might reduce growth.
Thanks for clarifying.
I understand that retirees may end up touching principal on years of negative market returns or if the promised pension never materialises or abruptly stops, if Social security goes bankrupt, or they end needing intensive care but have no LTC insurance etc.
But if none of these things happen, does "withdrawing rate" still matter?
I understand that not reinvesting dividends might reduce growth.
Thanks for clarifying.
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