Yes, "Tom and Don" on the "Talking Real Money" podcast - who generally fall within Boglehead principles, albeit them being AUM advisors, recommend a 5% constant withdrawal method. Seems reasonable.That would be the same as just withdraw 3.33% of the current balance every year. The constant % withdrawal method has been around forever. It is often confused with the SWR withdrawal method of taking an amount which is a % of the initial portfolio value and increased by inflation (or not increased by inflation if you want).What if I said I misspoke and meant to say just divide by 30 every year? I was trying to get a handle on Amortization Based Withdrawal (ABW).
What I've been doing is withdrawing just what I need and it's been working out fine so far. I'm just thinking about figuring out something a little more durable for the long term.
The fixed % withdrawal cannot mathematically exhaust the portfolio though it can drop the value enough to be useless. The fixed % withdrawal does result in unpredictably variable income.
Statistics: Posted by BuglheadLuvsLondon — Sat Dec 21, 2024 11:59 am — Replies 44 — Views 2795