Focus
Full time employment: Posting here.
- Joined
- Oct 10, 2009
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- 640
Here's a nice condensation of the current debate regarding the safe withdrawal rate (it includes photos of Bill Bengen, originator of the 4% rule, relaxing during his well-deserved retirement):
New Math for Retirees and the 4% Withdrawal Rule - The New York Times
I'd say those criticisms could be leveled at any withdrawal system. A system by its very nature is never fully flexible or able to account for the unknown. All that said, there's no denying Bengen's accomplishment, which provided a dose of realism when it was badly needed and reset retiree expectations for a generation.
New Math for Retirees and the 4% Withdrawal Rule - The New York Times
"Critics of the rule point out that it is based on conditions in the United States during a very specific time in history; it also doesn’t take into account items like investments costs, taxes, different time horizons or the reality that most retirees don’t spend their money in a linear fashion. Some people may want to spend more early in retirement and may be willing, even comfortable, making cuts when the market plunges once again. And if retirees want to leave money to their children, they may need to trim their spending further."
I'd say those criticisms could be leveled at any withdrawal system. A system by its very nature is never fully flexible or able to account for the unknown. All that said, there's no denying Bengen's accomplishment, which provided a dose of realism when it was badly needed and reset retiree expectations for a generation.