BiggerPockets Money Podcast

Is the 4% Rule Dead?

15 snips
Mar 21, 2025
Is the 4% rule still a reliable retirement strategy? Experts reveal why many FIRE enthusiasts are misusing it and risking their financial future. They discuss the importance of adjusting portfolios, especially in a volatile market, and share strategies to protect wealth during downturns. Listeners will learn about the historical significance of the 4% rule and why diversification is essential now more than ever. Plus, insights into gold prices and alternative investments like real estate offer a roadmap to maintaining financial stability.
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INSIGHT

The 4% Rule Explained

  • The 4% rule helps determine how much money is needed to retire.
  • It suggests a specific portfolio allocation can sustain a 4% annual withdrawal over 30 years.
INSIGHT

4% Rule Paradoxes

  • Historically, the 4% rule has held up, even during market downturns.
  • However, most FIRE followers don't adhere strictly to the 4% rule's portfolio allocation.
INSIGHT

Stock Market Influence

  • The stock market has seen a 17-year bull run, influencing investment strategies.
  • Many investors prioritize stocks over bonds due to higher returns, deviating from the 4% rule's allocation.
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