Improving Your Retirement Strategy: Moving Beyond the 4% Rule
What is the 4% rule?
The 4% rule, created by retired financial advisor William Bengen, offers a simplistic approach to retirement savings. It suggests withdrawing 4% annually from a diversified portfolio to sustain savings over 30 years.
What are its flaws?
The market's volatility can disrupt withdrawals, potentially jeopardizing your retirement savings. Surging healthcare costs are another concern, urging a need for flexible withdrawal strategies.
Add a little flexibility to your plans
Consider implementing caps and floors on withdrawal percentages to safeguard your nest egg and enjoy retirement without financial worries.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.