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A few observations,

...I retired in 2000 at age 55. Let's just say my portfolio was more than adequate to meet my income needs in the long term at 4% withdrawal rate... Including automobile purchases I withdrew close to 5% on average until this year..

You might go back and double check where you got the 4% safe withdrawal rate from. The problem is that the 4% number usually starts at 65 and assumes that your goal is to make your money last if you live 30 years to the age of 95. If you start withdrawing money at 55 then the safe withdrawal rate would be significantly less than 4%. Depending on your assumptions and which SWR analysis you use the SWR rate for a 55 year old is probably more like 3.5%. If you have been spending 5%, then you have been overspending the 3.5% rate by about 40%, so even before you factor in a terrible stock market you were taking a high risk of outliving your money.

I adjust the 4% withdrawals every year to the end of year (12/31) statement. Actually, I don't withdraw 4% for income, but leave some for emergencies and large purchases...

Unless you are planning on leaving a large estate, then recalculating the 4% of your remaining assets each year will eventually cause you to have a unnecessarily reduced income and lifestyle. This is a double -whammy since not only is the 4% too low, but your remaining assets will alos likely be declining to match your declineing life expectancy.

...Just wondering what others are doing with their withdrawals now...

I’m not retired yet but when I do I plan on tracking and investing my money as if it were two separate portfolios;

1) My core retirement portfolio to mean my basic needs. This will be invested using conventional asset allocation starting out with 4% withdrawals if I am 65 then, or maybe a bit less.

2) The rest that can be invested as aggressively or conservatively as I want and will be used while I am young enough to enjoy things like travel.

3) Most SWR calculations are based on a generic “live to be 95” assumption. Usually it doesn’t really address the chances of you actually living to be 95. If you are married the chances of at least one person living past 95 is much greater so a married couple should take a slightly lower SWR rate than a single person. Likewise if you are single, the probability of a 65 year old male or female living past 95 is significantly different because women statistically live much longer than men. Here is a link that is a very simple, and probably oversimplified, life expectancy calculator that you can play with.

https://personal.vanguard.com/us/planningeducation/retiremen...


My gut feel is that the 4% SWR number is more of guideline than an exact rule and can best be used to raise a red flag indicating that you have a potential problem if you exceed it.

Greg
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