Skip to main content
Non-financial boards have been closed.

Non-financial boards have been closed but will continue to be accessible in read-only form. If you're disappointed, we understand. Thank you for being an active participant in this community. We have more community features in development that we look forward to sharing soon. | The Motley Fool Community
Message Font: Serif | Sans-Serif
No. of Recommendations: 2
If I commit to withdrawing only 2% of my stash, then I need less stash, don't I, because I'm spending it at a lesser rate.

Turn this around. If you need $50,000 to live on, and you "believe" The Study, if your SWR is 4%, you need a base of $1,250,000. If you don't believe The Study and believe that the most you can safely take out is 2%, and you still need $50,000 to live on, you need a base of $2,500,000. It sort of boils down to the fact intercst is betting the future won't be worse than the past (though he is NOT garuanteeing it) so you won't outlive your money and hocus is betting that it will be so much worse (the value of stocks will not continue to grow as in the past or something) that if you take out more than 2% you are in danger of going broke. Not so sure about the reasoning of the last part, but that's sort of the gist.


Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.