Rich asks:

<<He has about $32.5k in WM (Washington Mutual) and about $38k in Putnam Voyager. He is 54 and has no regular income. Any suggestions on how he might shore up this monthly income given the limited amount of funds available? I was wondering if there's a way to reinvest most or all of his current holdings and not have to dip into any principal. It seems his hit by capital gains would be minimal if he sold the WM and got into an FF, or at least an S&P 500 index fund; then remove his IRA from Paine Webber and move it into a discount brokered, self-directed IRA, also an FF or index. Any advantage to taking his annual expenses in a yearly lump sum rather than the monthly dividend check?>>

Sorry to pop a bubble here, but … On $70.5K his income need represents a return and a withdrawal rate of 11.9% to 13.6% without any consideration of inflation or principal growth. IMHO, that's unsustainable. Perhaps over the long term it might be possible, but during withdrawals we don't live in the long term. Various studies show that during withdrawals portfolio preservation is possible only when the rate of withdrawal doesn't exceed something like 6% maximum. You can see one example of that in my analysis in the 23 posts on this board starting at http://boards.fool.com/registered/Message.asp?id=1040013000079000&sort=postdate ,

In down years he could see some very nasty hits to his portfolio. You seem to be seeking some sort of "guarantee," and that just doesn't exist in the stock market. Long term average returns are great, but he's not living in the long term. Daily realities have a nasty habit of disrupting those returns. Personally, I suspicion he's survived this far only because of the sustained and unprecedented length of this bull market. That won't last, and when it's over that portfolio will disappear at the rate of withdrawal desired.

Sorry to be so gloomy, but I think it needed saying.

Regards….Pixy