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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 77389  
Subject: Re: Near Retirement--Best Investment Advise Date: 12/6/1998 9:39 AM
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Bill writes:

<<True, a 7%-of-balance draw will never run out of money. But it MAY leave you with too little to live on.

Example: You start with $500,000 at the end of 1965, so your first year draw is $35,000.
By the end of 1974, your balance has dropped to $160,666, so your draw is $11,246 (all in inflation-adjusted terms). In other words, the draw does NOT keep up with inflation each year, and can be severely less in some years, although the general trend over DECADES is to approximate inflation.>>

That's pretty much the same kind of conclusion I reached in the "Retired Ralph Redux" series of posts buried in the 23 posts starting at http://boards.fool.com/registered/Message.asp?id=1040013000079000&sort=postdate . Bear markets competing with high inflation can erode purchasing power and portfolios quite rapidly.

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