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Greetings to all.

Since the topic is retirement investing, perhaps it is not inappropriate to bring up the subject of how best to utilize your lifelong savings to produce a sufficient and dependable cash flow once salary income is no longer available. I realize that everyone's personal situation is unique with regard to the amount and type of financial resources, pensions etc. that they take forward into full retirement. However, it would seem that a common issue which must be dealt with is the logistics involved in generating the required cash flows at appropriate intervals.

Consider my personal situation.... I have determined that retirement income equivalent to a minimum of 85% of my pre-retirement salary will be sufficient to retain my current lifestyle. I expect to receive a pension in an amount equal to 60% of my salary. This is the result in taking part over a period of 36 years in a defined benefit pension program with the same employer. This pension is indexed. Therefore it would appear that my primary goal will be to insure that I can generate from other assets the equivalent of 25% of my pre-retirement income with a provision for growth in the principle at least equivalent to the rate of inflation.

My other assets consist of a traditional IRA and a taxable brokerage account, each invested 100% in equities. Since I am a firm believer in dow dividend based investment strategies, I feel a minimum expected long term return of 10% per year is not unreasonable. My goal is to limit my withdrawals to 5% of the principle value of of these assets. Secondary goals are to minimize the tax paid on withdrawals and otherwise create a fairly consistent and logistically simple income stream. It would appear prudent to rely entirely upon the taxable brokerage account (even to the point of exhaustion of principle) to maximize the tax deferred compounding provided by the IRA. This will probably result in drawing down the taxable brokerage account at a rate in excess of 10% event though the overall goal of keeping withdrawals at a level less than 5% would still be met since the IRA remains untouched.

Now on to the logistics..... The pension will be paid biweekly or monthly and requires no further action on my part. It is my intent to reap the dividends from the taxable brokerage account (and eventually the IRA) quarterly as they are paid. To make up the balance, some portion of the equities must be liquidated on a more or less regular basis. This is where the sledding gets a little tougher. The more frequently equities are sold, the more trading costs and short term gains are incurred and the more bookeeping is required. This "averaging out" process does create a consistent income stream however. Making fewer (but larger) withdrawls reduces trading costs but also returns.

I have found little written information on the process of optimizing the creation of income streams from equities. Surely somebody has grappled with this and can provide some recommendations. Any and all comments on this and my general approach are appreciated.
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