walkinwood
Thinks s/he gets paid by the post
Pfau examines various variable spending methods and compares them using consistent assumptions.
https://www.onefpa.org/journal/Page...ariable-Spending-Strategies-for-Retirees.aspx
It is an interesting read and I recommend it to people just starting to think about ER and the method(s) they will use to withdraw money in retirement.
However, in my 8th year of ER, I'm getting tired of reading these papers.
I am beginning to feel confident that our 4% of portfolio value on Jan 1 method can work with a bit of flexibility on our part. This method can be volatile, so a fair amount of head-room in your initial annual budget will make it easier to stomach. Our portfolio is 60 equities (large value/growth, small, international & REIT) and 40% bonds (TIPS and short/intermediate treasuries & corporate bond funds)
We also put aside a bit of money that we do not use to calculate our withdrawals. It acts as a buffer against volatility of withdrawals and is there in case we have some kind of emergency requiring gobs of money.
https://www.onefpa.org/journal/Page...ariable-Spending-Strategies-for-Retirees.aspx
It is an interesting read and I recommend it to people just starting to think about ER and the method(s) they will use to withdraw money in retirement.
However, in my 8th year of ER, I'm getting tired of reading these papers.
I am beginning to feel confident that our 4% of portfolio value on Jan 1 method can work with a bit of flexibility on our part. This method can be volatile, so a fair amount of head-room in your initial annual budget will make it easier to stomach. Our portfolio is 60 equities (large value/growth, small, international & REIT) and 40% bonds (TIPS and short/intermediate treasuries & corporate bond funds)
We also put aside a bit of money that we do not use to calculate our withdrawals. It acts as a buffer against volatility of withdrawals and is there in case we have some kind of emergency requiring gobs of money.