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reset my % of SWR?
Old 12-01-2020, 07:37 PM   #1
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reset my % of SWR?

So I retired at 60 a few (well a bit more than few) years ago and set a WR of 3.75%. Since then, my assets have almost doubled (with the help of a nice inheritance) but I'm still taking the same static amount that the original 3.75% was. Guess I was too lazy too calculate inflation. My WR is now only 2.59%.



Anyway, we are now mortgage and car debt free and are taking SS (I have taken restricted spousal). With my military pension and SS (once I take my own SS) we will be bringing in almost $84K yearly.


I should be able to reset my WR to 4% on my assets and not be too concerned with outliving my $$ correct? At my age (68) that rate is pretty safe plus I have the other $$ to fall back on.


I'm thinking I could give any excess to my kids or to charity.
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Old 12-01-2020, 08:52 PM   #2
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Originally Posted by dtbach View Post
I should be able to reset my WR to 4% on my assets and not be too concerned with outliving my $$ correct?
Correct. For a longer version, see https://retireearlyhomepage.com/popr.html.
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Old 12-01-2020, 09:08 PM   #3
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Congratulations, you've put yourself in a good spot to help yourself and others. I've always liked your Segway "Wild Bill should have taken more out of his IRA when he could have.... You're there now.
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Old 12-01-2020, 09:10 PM   #4
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I would definitely feel comfortable spending 4% of your current net worth at 68 years old. Time to enjoy your savings!
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Old 12-02-2020, 07:33 AM   #5
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Correct. For a longer version, see https://retireearlyhomepage.com/popr.html.

Great chart! I don't need anywhere close to 4% but the 30 year column says I can take 3.81%. I think I will just go with 3.5% and let it go at that.
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Old 12-02-2020, 01:20 PM   #6
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Thanks for that link to POPR...I read Greaney a lot many years ago and do not remember that particular post.

To the OP, the POPR looks like a precursor to the VPW approach at Bogle heads...there is also another poster there who models a PV approach. The VPW approach is described in the wiki and is a combination of age, time horizon and portfolio balance for determination of withdrawal rate/amount. In the spreadsheet, there is also a risk floor approach that defines a lower withdrawal amount based on possible portfolio loss. Some people use that amount for their withdrawal recommendation.

Bottom line, you should be OK increasing your withdrawal rate, however, there are some tools that allow a yearly recommendation and adjustment based on the current conditions and a few assumptions. You may be able to increase your withdrawal a lot more....and still be safe.
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