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Author: WilliamLipp Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76899  
Subject: Re: After Retirement?? Date: 9/1/1999 3:41 PM
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BGPenhollo Date: 9/1/99 2:58 PM Number: 13584
If one expects and feels comfortable that their investments will match the S&P over a 15 year period and the S&P does for example 11% (history repeats) then a withdrawal rate of 10.9% over that period will leave the investment value a bit above it's starting point.

This is true, but I think it's misleading. It could be a wild ride. If the 15 years of "history repeats" includes repeating 1974, you will see a year where your 10.9% is a LOT fewer dollars than the year before. If 10.9% of today represents the life-style you intend to support, there is a very strong possibility that you will not be able to afford it in many years. Most plans include some mechanism to smooth out this ride.
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