How Safe Does Your Safe Withdrawal Rate Need to Be to Retire?
Many retirees use the 4% rule to plan for their retirement spending. The 4% rule, based on a study by Bill Bengen, suggests you can safely withdraw 4% of your starting portfolio value for 30 years without running out of money.
Bengen used historical data from 1994 to find the highest withdrawal rate that survived 100% of cases, and his 4% safe withdrawal rate has held up ever since. But do you really need 100% certainty to retire?
Image source: Getty Images.
Source Fool.com