Poll:To those who retired or retiring very soon - what is your comfy withdrawal rate?

[cyber888]

I've read an article link here recently that based on a recent article, the 4% withdrawal rate still works over the last 30 years.

But with the economy not doing so well - interest rate hikes to next year, Feds sucking liquidity dry starting June, China crashing today, and the ongoing war, I wanted to do a survey on withdrawal rates.

I think I myself will try to do 3.0% or 3.5%, when I retire next year, but not sure yet.

[big-papa]

None of the above because I won't be using a fixed withdrawal rate. However, if I were retiring today, the first year's withdrawal would be 4.6%
https://www.bogleheads.org/wiki/Amor...sed_withdrawal

Cheers
Big-Papa

[punkinhead]

I'm withdrawing 4.5% for the next 6 years until SS and a small pension kick in. After that it will be about 2.2%.

[aja8888]

My withdrawal rate is what the Gov says for my annual RMD (4+%). Otherwise, we live on the SS as it comes in.

[Yoheadden]

https://www.bogleheads.org/wiki/Vari...age_withdrawal

I’ll start with 3%, but then use a variable withdrawal rate. The 4% may still work for some situations, but could result for running out of money in others.

[pb4uski]

We are currently about 2.1% (2022 withdrawals/2011 retirement assets).

However, it was about 4% when we first retired because my small pension and DW's SS were not online then.

[COcheesehead]

I work backwards. I created a comfy budget including all the fun stuff like travel and lumpy expenses like a new car every so often, added 30% as a buffer, then added a little more for things I cannot anticipate and that’s what I take out. It happens to be about 2.4%. So that’s my withdrawal rate. FireCalc tells me I can take a little over 4% even with a conservative allocation of 30/70. So I have lots of wiggle room.

[MichaelB]

If half our spending were covered by pensions or other income streams we’d easily be at 4% and probably be closer to 5%. We have very little SS and no other income, the portfolio needs to cover >90% of our spending. Right now we’re at 3.5% and I could get to 3% without a significant decline in our standard of living.

[braumeister]

It varies widely from year to year. So far it has been between 1.5% and 3.9% but generally somewhere in the vicinity of 3%.

[Trailwalker]

We're at 4%, but we talk about what we will withdraw each year when constructing our budget. We try to stay flexible based upon conditions.

[scrabbler1]

I don' t select a WR and use it as a quota to control my spending. Instead, my WR is whatever my actual spending was for a given year divided by my portfolio amount at a certain time of that year. That WR has varied over the 13 years I have been retired, as low as 1.1% in 2021 to as high as 2.6% in 2010. From 2012 through 2019, the WR varied from 1.8% to 2.3%. In 2020, I adjusted the stock side of my portfolio so it would generate less income (from cap gain distributions). This lowered my income taxes and lowered my health insurance expenses by getting me back on the ACA subsidy train, something I had fallen off of in 2017.

[CardsFan]

We would be comfortable at 3% . But with both SS online this year, actual will be about 1.5%. Nice to know the market can move, and we don't need to care.

[Dtail]

Through 4+ years of retirement so far, it has been 3.3%. Will be around 5% for 2 years, then under 2% due to a lump sum pension, back to around 5% for 4 years, then ~2% at 70 y.o. onward.
That's the plan, but am flexible and of course the denominator will change the %, plus I use the retirement calculators each year to re retire again each year.

[jollystomper]

Currently about 62% of our spending is covered by my pension plus DW's SS, so our withdrawal rate is very low. Looking at our cash flow drawdown since I retired, our current withdrawal rate (retirement spending from cash cash/assets at 2018 retirement) is about 1.3%.

I went into retirement with a 2.3% withdrawal plan, but our expenses have been much lower (primarily due to overestimates of medical and travel costs, and the pandemic impact). We do plan to buy a car this year, which (assuming the market stays flat the rest of the year, HA!) would bump our retirement-to-date WR closer to 2%.

[W2R]

None of the above. My situation sounds a lot like JollyStomper's. My planned WR was 3.5%, but right now I have SS and a mini-pension and I don't really need that much. So far my annual spending has been 0%-2%. Whatever I don't need stays invested in my portfolio.

[arcyallen]

Quote:

Originally Posted by cyber888 I've read an article link here recently that based on a recent article, the 4% withdrawal rate still works over the last 30 years.

I'd be very slow to accept a 4% withdrawal rate as "working over the last 30 years".

If you had $1m invested 100% in an S&P index in 2000, taking 4% withdrawals increasing with inflation, today you'd have about $400k left taking $66k/yr out. That plan technically is still solvent, but won't be for long. You could have factored in some bond exposure, but you'd still be in rough shape today.

The problem for many people retiring is they're often retiring near market highs. How many people retired after the big runup to 2000? People rarely retire after a big drop. And if we're near market highs, that 4% rule may struggle.

[Gumby]

So far, over three years, our withdrawal rate is negative (i.e. we're saving money), but that will change when we start traveling again. Even then, I expect it never will exceed 2%.

[Car-Guy]

Can't vote since I never calculated it. Just spend what I need (or maybe it's want). I watch my NW on an annual basis and as long as it stays above my arbitrarily set level it's full speed ahead. As I get older, I have considered lowering that number since I don't think I'll ever get there. The problem is, I can't do (spend) what I could a few years ago. However, inflation is helping me get there.

[tmitchell]

I'm looking at about 3.5% when I start withdrawing next year. I use Vanguard PAS and they have me at 4.9% with a 98% success rate. So 4% will likely be just fine if I can find a way to spend it!

[CardsFan]

Quote:

Originally Posted by arcyallen I'd be very slow to accept a 4% withdrawal rate as "working over the last 30 years". If you had $1m invested 100% in an S&P index in 2000, taking 4% withdrawals increasing with inflation, today you'd have about $400k left taking $66k/yr out. That plan technically is still solvent, but won't be for long. You could have factored in some bond exposure, but you'd still be in rough shape today. The problem for many people retiring is they're often retiring near market highs. How many people retired after the big runup to 2000? People rarely retire after a big drop. And if we're near market highs, that 4% rule may struggle.

While technically you are correct, assuming that person was say 55yo when they retired, they are now 77 have been collecting SS for at least 7 years. So they are probably fine