I am trying to determine what may be the best strategy withdrawing from my taxable account as I wish to leave TAx deferred accounts alone until RMD's are required. I am 56 and my wife is 55. Both of us are recently retired. Currently have $4.3 million with about a 50/50... equities/fixed income AA.
In taxable I have about 900K in VAnguard index stock funds and $800k in a muni bond fund. The rest is TRad and Roth IRA's. By running a BAcktest Portfolio AA even starting in 2008 , an awful year to retire as we know, and withdrawing 4% annually just from the taxable equity funds.... the balance in 2015 was still
ahead of the starting balance by $100k. Obviously, 2013 was a great "recovery" year as 2008-2009 resulted in a 38% drop in portfolio value. THis leads me to believe that it is indeed safe to withdraw 4% form the equity portion of my taxable account no matter what market returns are. Or is it more prudent to suspend withdrawals during down years and instead take from a cash bucket to meet expenses until markets recover?
We will also have pensions and SS waiting for use starting in 5-6 years.
Also the muni bond fund (intermediate) from which I take monthly distributions as cash to also help with monthly expenses.
In taxable I have about 900K in VAnguard index stock funds and $800k in a muni bond fund. The rest is TRad and Roth IRA's. By running a BAcktest Portfolio AA even starting in 2008 , an awful year to retire as we know, and withdrawing 4% annually just from the taxable equity funds.... the balance in 2015 was still
ahead of the starting balance by $100k. Obviously, 2013 was a great "recovery" year as 2008-2009 resulted in a 38% drop in portfolio value. THis leads me to believe that it is indeed safe to withdraw 4% form the equity portion of my taxable account no matter what market returns are. Or is it more prudent to suspend withdrawals during down years and instead take from a cash bucket to meet expenses until markets recover?
We will also have pensions and SS waiting for use starting in 5-6 years.
Also the muni bond fund (intermediate) from which I take monthly distributions as cash to also help with monthly expenses.