You really havn't given enough information to give a definative answer. If more than 50% of the funds were in stock funds and only a little in bond fund I'd say there was a problem. The exact ratios are debatable but being in retirement most should be in bonds or other stable cash generating investments. Even if a lot of money was in bond funds, if the bonds were all long-term bonds and/or high yield bonds which experience wide principle fluctuations due to interest rates and/or credit risk there would be a big problem. If 10-20% were in short term bonds (prefferably muni bonds being a trust) this would be a near cash equivalent. During down times these very stable bonds could be sold to pay expenses while during good market years the stocks could be sold to pay expenses and replenish the short-term bond fund. 8% withdrawl rate is unsustainable. Your friend is going to run out of money if they live a couple of decades unles we hit another 80's style bull market. Budgeting and/or another income source is needed badly. Hopefully this helps but you need to understand that there are a lot of variables involed that you havn't supplied.
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