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Hi, Susi,

Short answer: Yes, I think you can be reasonably confident in following the conclusions from the safe withdrawal studies. Since I don't altogether rely on my own spreadsheet either, I use the safe withdrawal studies for validate my spreadsheet results. It may benefit you to save all your social security payments when they start (if they start) to pay your income taxes when they jump because of IRA withdrawals.

Long answer: My main caveat about using just the safe withdrawal studies comes from considering income taxes and, to a lesser extent, social security.

(Please pardon the repetition, I know I've posted this before . . .) If I take the same withdrawal rate throughout my retirement, my standard of living will jump when social security starts in five years and be severely squeezed starting five years later, when I have to start IRA withdrawals and pay sharply-higher income taxes. I don't want that to happen; I intend to provide myself with a constant standard of living in retirement, although it fact it has been climbing. Burning up the IRA while younger is no solution in my view because it squanders the tax shelter prematurely. Just as I don't want my standard of living to fall when those tax bills come due, I don't want it to rise when social security starts (as I bet it will in 2004).

The solution for me, found by my spreadsheet optimization, is to average 3% withdrawals in my 60's, letting the retirement accounts grow a little over that decade, and taking 4% withdrawals thereafter. This way, my standard of living is insulated from the government giving and the government taking away. Or, so I plan. The safe withdrawal rate studies seem to ignore these considerations.

Chips, who runs spreadsheets for the fun of it, while recognizing that some people don't
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