The 4% rule is an incredibly powerful tool when it comes to saving for your retirement. In essence, the rule indicates that if you keep a diversified and balanced portfolio, you can:

The math works out such that your key target ends up being to have a nest egg that's 25-times the amount you'll want to withdraw from your account in your first year of retirement. Especially as you're just starting out on your retirement savings journey, that's a great target to aim toward.

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Source Fool.com