Withdraw Wisely: The 4% Guideline

The Trinity study, which examines various withdrawal rates, indicates that a 4% withdrawal rate has a 96% success rate for sustaining a portfolio over 30 years. While often referred to as the 4% rule, it is more accurately a guideline that requires active management. Withdrawing 4% annually, adjusted for inflation, can lead to significant growth in your portfolio, potentially resulting in much more than the initial investment after 30 years. However, neglecting to adjust withdrawals could expose individuals to detrimental risks, particularly in market downturns. Therefore, using the 4% guideline as a starting point for withdrawals is advisable, while remaining flexible to enhance enjoyment and security throughout retirement.

Transcript

Play full episode

The AI-powered Podcast Player

Save insights by tapping your headphones, chat with episodes, discover the best highlights - and more!

Get the app