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One of the problems I have with the Trinity study is that it assumes an average market rate of return. What happens if we instead put our money in the Foolish Four or RP4 or whatever we call it these days? It seems to me that if the average rate of return goes up, the acceptable withdrawal rate should also increase. I don't think it is the same percentage increase because the standard deviation of the FF is higher than the market, so the computation is complicated.

I personally like the constant % of the value of the portfolio method. Most people will also get some Social Security, so there is a fixed "floor" income and the % variation in total income is dampened by this. The other rerason I like it is that the idea of projecting a constant inflation rate over 35 years has a large chance of giving a result which does not at all correspond to reality.

The other issue I have with studies like Trinity is that they do not consider the chances for a "mid-course correction". I for one, do not intend to retire, set up my portfolio, and then never have another financial thought for the rest of my life. I will monitor my investments and make minor changes as necessary.

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