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Everyone's wrong about the 4% retirement rule being safe now.
I ran the numbers for my own plan in Chicago, and the old 4% withdrawal rate looks shaky. Bond yields are still low and stock prices feel high, so the safe start rate is closer to 3.2% if you want it to last 30 years. Has anyone else had to cut their planned retirement income because of this?
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uma6855mo ago
Man, this reminds me of my uncle who retired right before the 2008 crash. He just kept spending like nothing happened and had to go back to work part-time. It really spooked me into building a bigger cushion.
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rileyellis6mo ago
Hold on, I see it the other way. The 4% rule was always a starting point, not a set promise. My own plan uses a mix of stocks and some real estate, and I keep a cash buffer for bad years. I just skip the raise for inflation if the market's down. That flexibility makes a big difference.
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nina_johnson866mo ago
Yeah, because my whole retirement plan was built on a promise from a math problem from 1994. I'm sure the economy will follow those exact rules. I'm just gonna work until I'm 80 and hope the bar tips are good that week. All these rules just make me want to hide my cash in the backyard.
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