How to Implement the 4% Rule
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- Опубликовано: 2 июн 2024
- A viewer asked me a series of questions about the nuts and bolts of using the 4% Rule. I do my best to respond to his questions in this video.
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Timestamps
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0:00 Implementing the 4% Rule
1:24 How often do you pull money from a portfolio?
6:49 Do you automatically reinvest income?
12:40 How do you handle market drops?
15:40 Should you hold a lot in cash?
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ABOUT ME
While still working as a trial attorney in the securities field, I started writing about personal finance and investing In 2007. In 2013 I started the Doughroller Money Podcast, which has been downloaded millions of times. Today I'm the Deputy Editor of Forbes Advisor, managing a growing team of editors and writers that produce content to help readers make the most of their money.
I'm also the author of Retire Before Mom and Dad--The Simple Numbers Behind a Lifetime of Financial Freedom (amzn.to/3by10EE)
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I've decided on a '5.2% rule'. I will be 65 and am planning on 20 years. If I live longer I will sell my second home and I also have a small stock portfolio (40K!) that will hopefully grow over that 20 years. I also have my primary residence if it comes to that. I have no dependents and plan on spending every cent.
Spend everthing brother
Die with epic experiences good luck
Rob speaks to me the way I wished all the hired and fired paid advisors spoke to me throughout the years. I'm managing my portfolios on my own now, and Rob has given me the required knowledge and confidence to do so.
We're glad you're finding Rob's videos helpful, I do too.
2023 will be my first year implementing my withdrawal strategy in retirement. I settled on 3X a year or every four months. Quarterly seemed like too often and less frequently felt like too much money out of the market at a time (I also have an emergency fund in cash). So we will see how that goes.
Thank you, Rob for another year of great content. Yours is the best financial channel, hands down, IMHO. Keep up the fantastic work. You are truly performing a public service and you have been incredibly helpful to me as I have transitioned to retirement. Wishing you a happy and healthy new year!
Good luck dude!
Cash is King. Love Bucket Strategy
Hi Rob. I can't begin to express my gratitude for such a clear, concise and practical approach for distribution of annual income following financial independence. It really is remarkable to have people such as yourself and the Bogleheads providing the rest of us with us clear directions on how to best manage the uncertainty. It is sincerely appreciated. But there is one point I disagree with. Yes, the 4% rule is based on the best possible information available. This goes back 100-150 years. An extensive amount of data to be sure. And yes 2022 is statistically a once-in-a-hundred-year-event with bonds and stocks both down in double digits. However, I would argue that larger scale fluctuations, positive or negative, appear to be more likely in the future. Based on many things really - the market itself, but also nature.
Thanks again for the all the great work you do. I wish you and your loved ones a happy, healthy, and wonderful New Year, full of beautiful moments and delightful surprises.
I made a spreadsheet to forecast my retirement “salary” and withdrawals from each account (including social security income) for every year of retirement (to age 93). And I made some basic assumptions on annual ROR for each of my accounts, and taxes, inflation etc. I will follow this plan, and update it quarterly with actual. This seems a much better idea than the 4% rule which is flawed. Recent studies have shown the rule should be changed to the “2.7% rule”. So I prefer to plan and then reforecast every year.
@RobBerger this will be in your Hall of Fame series if you ever create one. A terrific explanation of implementing the 4 percent rule that I will revisit many times. Thank you very much.
So nice to see someone finally addressing these specific implementation questions! Great explanation!
@robberger please make a video on your opinion about "bonds" or "no bonds" in your 401k when you have a pension or multiple pensions. All SP 500 and International? Your content is great, thanks.
Thanks Rob. Always informative and concise.
I have watched too many hours of RUclips videos and those videos and even my own financial advisor did not give me the answers I was looking for. This video told me everything I needed to know about how to execute the withdraws. Thank you Rob. You just helped me so much by explaining it to me in a way I could really understand. I have 2 years of expenses in a HYSA about 70K. It makes me feel safe in case there is a bad year and it still earns around 4% interest. I plan to continue to grow my principal for my kids one day.
Great video Rob, thanks and all the best to you and family for this new year!
Thanks, Rob. You're the only one who has in detail explained how to take out money in retirement. Keep educating us!!
Good timing for this video. We’ll done! Happy New Year!
Great question and great answer. Thanks for sharing.
Rob, 2023 will be the first year I’ll be faced with taking RMD’s. Could you talk about overlaying RMD’s with the 4% rule. Thanks
Thanks for another helpful video Rob! Happy New Year and 100K Subs in 2023
Extremely helpful - thank you!
I became a dividend investor after seeing my portfolio crushed in 2009 and now I'm so glad I did. I own 46 stocks and 4 ETFS and just have dividends sent to my fixed cash account. I sweep them once a month and put them in my budget. The dividend raises make up the inflation adjustment. It's easy and seems to work for me. Been retired 20 months and all is well so far.
That’s fantastic. I started doing the same 5 years ago, completely on my own. After reading dozens of books on finance and investing I came to the same conclusion on dividends. With somewhat mathematically insignificant compounding in 5 years, what I’ve managed to accumulate in this short period of time is still staggering to me.
Here’s to five more years of not doing stupid things, oppose to finding the next “best” thing!
Rob I enjoy all your video. Most people are visual learners.
From Google..., "What percentage of learning is visual?
Research has found that 65 percent of the general population are visual learners, meaning they need to see information in order to retain it. Visuals add a component to communication that written and verbal methods do not: speed."
I would love you to up your game by adding more visuals to your talks. Charts, Graphs, Tables that outline what you are saying. I also watch Pension Craft RUclips channel and I truly appreciate how he SHOWS (think Toastmasters - "show what you mean" presentation) what he is explaining/conveying in his words. For me that would amplify your value 100%. AND I appreciate what you do you are a go to for me in my 50+ years.
I dump 2 years of spending into Ally online savings account with automatic monthly transfers to my checking account at a different bank. After a year I replenish by selling from my one-fund portfolio. I let the managers at Wellington worry about rebalancing. Been doing this for 10 years of retirement and it's worked very well. BTW, Ally is currently paying 3.3% on savings so not to bad and I have minimal work to effect a monthly paycheck.
Instead of Ally, you might want to just consider setting up a bond ladder or using a treasury money market fund (e.g., VUSXX, TTTXX, etc.) for a better return that’s still risk free
Good idea. Wellington, Wellesley or another fund the group manages?
Vanguard Federal money market is 4.21. Take a look at that.
Two to three years of expense is what I was planning. So somewhat similar to your plan. I definitely want at least 2 years cash in a taxable money market then start a ladder in the retirement funds. Then allocate a small percentage from gains for ladder during the good market. If the market is bad then draw a portion from the ladder to preserve some of the capital from the stock and bond funds as needed.
The potential flaw with my plan is that if you had a very bad bear market for 18 to 24 months followed by a short term bull market then another bear market it would quickly eat up the reserve and make it difficult to rebuild the two years of funds after the ladder is depleted. It just seems to be a decent plan to keep more of your portfolio in the market.
Much better options than Ally..
Thanks for the explanation Rob, I found it very useful
Thanks for the great explanation. I particularly like calculating your own personal rate of inflation. As you have real world data, would you mind sharing with us your personal inflation rate for 2022? It would be very interesting to compare with CPI. Thanks again Rob!
That's right Rob, keep it simple. As I close in on retirement, I've had my paycheck direct deposited to my Fidelity account for several years, and scheduled automatic transfer to my checking account to mimic a paycheck. This has helped me accustom myself to living from my investments, with the additional benefit of automatically hiding pay raises in my investments rather than seeing them show up in my checking account where they'd be spent.
That’s some sharp thinking outside the box!
Thanks, Rob! I was just thinking about this topic this week as I get ready for early retirement in 2024. Please make more videos about withdrawing in retirement. Thank you! 🎉
good ideas Rob. I’m leaning towards an automatic monthly withdrawal since i pay my bills monthly. Having a years worth of cash in my checking account or even a quarters worth of cash is too easy to over spend in the earlier months and scrimp in the later months. So im thinking this method serves as a behavioral filter from overspending
@Rob Berger Thanks. I plan on going 90 stock/10 bond in Roth, keep it simple in my Traditional IRA and just go with Wellington Fund (VWENX). Follow the 4% rule to budget withdrawal amounts but initially use the Roth as large expense/travel/emergency fund. To control taxes I’ll move the “4% + inflation” form Traditional IRA every December to a normal brokerage account investing in tax exempt bonds (VTEB). Then withdraw from VTEB over the year as budgeted. Thoughts/advice?
Great topic, thanks for the detailed analysis Rob. I take my IRA withdrawals monthly; takes 3 min with Fidelity - same amount every month. As for not letting 2022 dictate strategy, probably worth noting that yes, it’s not very normal. But, sequence of return risk IS a danger for someone starting retirement now. Also, blindly following 4% rule, which assumed much higher bond returns than we’ve experienced in 20 years, is not something to gloss over. Bond real return outlook would dictate 3 or 3.5% initial withdrawal rate if retiring now in 2023.
Thank you for sharing
Great video
Thanks for the video
Hey Rob . . . continuing with the hypothetical, applying the 4% factor on a $1MM portfolio derives a $40,000 withdrawal. However if RMDs are say $45,000, does that required withdrawal satisfy the 4% "Rule"? If so, since you're $5,000 over the recommended withdrawal should you simply plow back in those additional monies into the portfolio?
Thank you @Rob this one is really getting me a bit confused. I am holding a bucket one in cash and bonds for 3 years expenses. Would you think that using a trigger point of the total portfolio dropping below 4% (or in my case 3%, we are early 50s) as when you do not sell assets and you use the cash to cover expenses until the total portfolio comes back?
In 2021 I moved 5 years of living expenses into my stable value fund and I plan to retire in 2025. When the market is up the previous year I will take 5pct out of Vanguard Wellington and when the market is down take it out of stable value fund and never take an inflation raise. I believe when your getting ready for retirement you have to get a mindset of not trying to keep every bit of money you can in the market because you will be drawing down on the portfolio.
Found it! Hehe Thank you, Rob.
Rob, how would you recommend to include the recent shifts in market environment in your investment approach when you are in the accumulation phase (early 30s)? With risk-free (treasury) debt returns sitting over 4, and moderately risky corporate debt returns of blue chip tech stocks sitting at 8, I wonder if I should distribute more of the savings portion of my income into debt rather than equity?
Rob, great stuff as always. When talking about withdrawals quarterly, I have a question. Do you withdrawal a year's worth of cash at retirement and then add a quarter of cash every quarter, or are you literally just holding a quarter of cash each quarter (plus maybe a 3-6month emergency fund) so you run out of cash just in time to withdraw another quarter of cash? Thanks and keep the great info coming!
I think that would be completely up to you. You could draw it out in a lump or could maybe drawer twice the usual amount and build up to your desired target. Id be inclined to draw the lump out for ease especially if its been a good year in the markets, its easier to just bite the bullet. if the markets were down I maybe would go with half and see what its like later in the year for the rest.
Thanks. I find myself not wanting to sell this helps
Is there a rule of thumb or best guesstimate for how much dividends and interest your portfolio will generate? I have a 70/30 asset allocation, all in mutual funds and ETFs, things like total stock market, S&P 500 index, total bond. I was told around 1% but interested in your take. I know it depends a lot on what your holdings are, but don't want to wait till December to find out if I am going to be short, or if I could have spent more in the prior year!
People are used to getting bi-weekly/weekly paycheck and in retirement it's a different ballgame. This is the reason I implemented dividend income strategy it works for me and I simply replace my monthly paycheck in form of a dividend payout. Bucket strategy, 4% rule all of them sound wonderful in theory however, difficult to implement for an average Joe! I want to be enjoying my retirement rather than be doing bucket shuffling each year. Although, I've kept 2 years of money in form of MM fund.
Retired two years. Withdraw from my Vanguard short term bond index fund monthly along with SS to mimic when I worked. The rest for retirement income in a series of Vanguard target date funds. Emergency fund in money market and end of life money at Schwab in a rowe price target date fund
Could you please go over automatic dividend reinvestment and how it affects the wash sale rule? I was told that dividend reinvestment during the prior month into a fund sold at average cost can trigger a wash sale but that if the fund is sold on a first in first out basis, it's not an issue. Is this correct?
Hi Rob, Great video...very informative. It would be great if you could talk about a different version of the 4% rule, in which you take a flat 4% per year from your portfolio. This should cover both bad and good years, inflation etc. Your thoughts would be very interesting...
The big issue with a flat percentage is that the amount can vary significantly from year to year due both to market fluctuations. Another approach is the "Yale Spending Model", which I'll cover, that combines both a flat percentage and an inflation-adjusted amount.
@@rob_berger Rob, Thanks for your response. Looking forward to your discussion on the Yale spending model. I think a system that is more dynamic and sensitive to market changes might be a safer way to go
Rob, can you please do a video on the huge 2.4 put-to-call ratio spike we are seeing?
Another withdraw strategy is selling cash secured puts against the s and p 500. I thing you could withdraw 8% safely doing this. Basically sell 15% out of the money puts on SPY with a 3 month expiry while keeping your cash in a brokerage that’s pays $$ on your cash balance. (Interactive brokers pays 3.8% right now on cash balances). This strategy allows for a safer withdraw rate of around 8%.
Hello,
I just discovered your channel and I am
learning a lot.
Question:
I have enough savings so for at least two years I don’t need the money in my retirement accounts. Should I still withdraw an annual amount or should I leave it be?
I looked for this info on RUclips and it is hard to find.
I hope you include the answer to my question on one of your videos. Thanks.
I would recommend to anyone that they plan to have at least 1 year of cash saved by retirement to burn in case they start retirement in a year like 2022. I cannot express how horrible it is to have to sell IRA positions when they have lost so much as in 2022.
I would also recommend (assuming you’re retiring before full retirement age (FRA)) delaying SS until at least FRA. And to set up a bond and/or CD ladder to provide FRA SS income until you reach FRA. You don’t want to miss out on the inflation adjustments and more monthly income for life that SS will provide if you can do that.
Hey Rob, let me know if I am totally mixing up concepts here, now that 30-year treasury-bonds are starting to break into the 5% range (hey maybe it goes to 6%) can I now start thinking since I'll be getting over 4% then I'll just park my money in these t-bonds? Why would that not be a good idea? What factors are being missed in that thought process? (inflation, stock value gain/loss, etc?)
I wish you would do this while showing it in a spreadsheet. Then you could show exactly how to put dividends into spendable savings account, and then rebalance your portfolio. It would be better for me to see it visually.
Once a month, write down the market value of the mutual fund, multiply it by 0.04, divide the result by 12, sell this mutual fund by that amount, transfer the cash to checking account. People invest once a month into retirement account using dollar cost averaging. It makes sense to sell withdraw using the same approach. In a bear market year, sell less and spend less automatically.
You do not pay bills once a year. You do it every month.
I actually like this idea, keeps your money in the market and as you say you are (in my case, pound cost averaging). It also gives you a bench mark for how much you can spend that month so stop you overspending. Interesting.🧐 Obviously I would still hold some bonds and rebalance once a year rather than holing all stocks. Id be inclined to still hold a cash as part of my allocation to the bond portion of the fund at maybe 15 - 20%. I dont fancy having 30% plus in bonds.
I believe Rob that 2022 was not as much an oddity, but rather a sign of stocks being overvalued. Much of the S&P 500 was made up of companies that had price to earnings ratios of up to 90 to 1. I am not prophetizing a gloom and doom scenario, but there are still some hefty ratios out there that deserve to be pared down to make them truly "a buy".
I assume the inflation adjustment is cumulative? So if the end of the second year the inflation is 5%, and the end of the third year inflation is 7%, you would take out 12% more at the end of the third year?
Ben Felix has a video explaining why he thinks the safe withdrawal rate is 2.7%. I recommend checking it out.
If you withdraw quarterly, are you applying the 4% to the balance at that moment in time? Or are you applying the 4% at the beginning of the and sticking with that?
This month, Bill Bengen rchanged his withdrawal rule to 4.7% due to including small and micro cap asset classes. However, he suggests using 4.5%.
I believe worth noting that Bengen, Trinity, and similar studies all assumed reinvested interest and dividends. Taking them out of the equation means you’re not really following the recommendation. Not a big deal if you’ve saved way more than you need.
There are several monthly income funds available, made up of stocks, bonds, reits & possibly some covered calls, that are in the 50/50 asset mix for retirees, that deposit about 4.5% in your bank account every month, and no worries about diversification, rebalancing or withdrawing funds.
Tickers?
@@rob_berger I'm in Canada so not sure what the tickers are in the US, but three popular ones up here are ZMI, XTR & VRIF ( products of Bank of Montreal, Blackrock & Vanguard ). I’m sure they have similar in the US
My Fidelity M/M fund is paying 3.82%
@@franksatterfield9764I believe Fidelity is a mutual fund, so it would have higher fees than the 3 etf's I suggested. I just looked up monthly yields for ZMI 4.61%, XTR 4.61% & VRIF 4.72%., with mere fees about .60%
SPAXX has an expense ratio of 0.42%
I let dividends etc accumulated in fidelity money market account, use savings for expenses, including draw down IRA/401K while tax rate is low, then annually pull the dividends over to savings to replenish and make final adjustments at year end.
If you take the entire amount in December, haven't you left the maximum amount "working" in the market, invested all year long? Taking out 1% every quarter would mean taking it out EARLIER, right? Am I missing something?
You say Bill effectively meant for you to use your dividends. Then the next sentence or so you say he specifically didn't say anything to the kind.
It can't be both. The 4% "rule"(actually it's just historical data it's not a rule) was assuming total return in my opinion and withdrawals coming from selling shares
Let's say you keep 2 years' worth of expenses in a cash bucket, specifically for the rare year when both stocks and bonds are down. You want to wait until some degree of recovery before replenishing it (i.e., you spend from it, but don't immediately replenish it). Hopefully at some point before it's depleted (i.e., within 2 years), you see a recovery, and at that point you're happier to do the replenishing then. How do you decide when to finally replenish? (i.e., how much of a recovery is enough?) It seems kinda like a game of chicken: how close to the end of your cash do you dare get? On the other hand, if we believe Bengen, we can just suck it up and sell when we need to, even when everything is down?
Just a thought, but maybe if your funds are up, say 6% in a given year, maybe you can draw the needed 4% for the year from that fund, and then also remove 2% as a start of replenishing your cash fund. I don't have it all figured out yet, but I think there is no right or wrong way, just the way that works best for you.
Without trying to sound cruel, if you are saying you don't know when you will be able to draw cash at the optimal time is almost like trying to time the market. I would take the cash at the time you think its right to, if you have ran out of cash then you know what to do. I've seen a lot of posts not asking this type of question. Really there is no hard and fast rule if you are looking for this type of answer maybe you would be better off with a financial advisor.
Cash part of the bond portfolio????
Doesn't rebalancing have tax implications?
I don't really understand the logic of the 4% rule. Wouldn't be simpler, safer, and more effective (keeping more money invested) to only take out what you need from your investments every month to cover expenses, no more, no less? You pay your bills monthly, not yearly or quarterly. In my case I haven't had to sell any investments since I can live off my interest and dividends every year.
4% is the max. If you can get by with less you're gold!
The section on determining your personal annual inflation rate, I have a problem with your described approach.
Determining your own inflation rate is not as easy as you describe, because what you describe will also include your own spending habit changes. Say you bei more gasoline due to road trips, than typical , or take an extra flight , or buy more groceries.
Inflation computing requires the “market basket” be the same year over year, to make the computation. So you would have to find a way to get to that in the spreadsheets and that may be hard. Do you track per car fill up and compute the years average full up price, and the average grocery store trip price ? Rough but not ideal estimates. Having the govt do the hard work do tracking and computing on a market basket is worth it to me. Use the published CPI numbers.
Otherwise if you use your annual spending, then in a year where you spend more for some reason , your computed rate will be overly high causing excess with-drawls , which may become a positive feedback loop that burns though your nest egg.
Can't we just sell 0.33% portfolio every month or 1% every quarter?
the problem with the quarterly approach is that the dividends are back loaded to Q4 so you don't get a lot for spending in the initial part of the year and then have a lot more at the end, I am planning to let the prior years dividends accrue, and with rates at 4% in money markets now it's much less painful to do that than in the past, then 1st week of Jan sweep that out to my savings :)
4% "rule"has nothing to do with dividends it has to do with Total return.
Historically 4% is the safest highest withdrawal rate from a portfolio of stocks and bonds. (It doesn't involve dividend specifically but Total return)
Whatever cash is leftover rebalance into SCHD or ICSH. Not Complicated. Quarterly I will rebalance into other funds if necessary. Roth IRA always reinvest.
What if in retirement, it’s a terrible time to sell (like now) but you are relying on the income? Just suck it up?
Most people have cash reserves in my experience.
Generally you would withdraw from bonds when stocks are doing bad (but of course this is a rare year where stocks and bonds of both fell)
@@johngill2853 thanks
Ok Kiddies..Retired @59...I have 1&1/2 years living expenses in Ally Savings. This year living off savings. Starting Jan have monthly withdrawal of 2% Rollover IRA from TD into checking for monthly expenses. So during 1st week of month, check cash balance...this takes 5 minutes.
Wait, did you say 2% every month? (Way more than recommended 4% a year)
@@3namechangezalowdevry90day7 Really??? Duh. 2% of Total Amount/12.
Yes, 2% is half of 4%, but you said "MONTHLY withdrawal of 2%". Say you have a nest egg of $ 500,000.00.Take 500,000.00 x.02 = 10,000.00, x12 MONTHS a year and that gives you $120,000.00 a year...WAY MORE than 4% annual maximum recommended ($500,000.00x.04= 20,000.00).
I'm still stuck on what fund/funds to keep in my Brokerage account.
It really depends on your age and risk tolerance. I recommend low cost index funds, look at Warren Buffet’s 90% S&P 500 / 10% Short Term Bonds and Bogle’s 3 fund portfolio which Bogleheads have tons of recommendations on (I.E. Total US Stock, Total International, Total Bond.)
I would recommend index ETFs in normal brokerage accounts and index funds in tax sheltered accounts.
Keep in mind Bogle's phase "the majesty of simplicity". Hope that helps.
Best of Luck!
@@Jechum Yeah I'm thinking VTI or VOO, but considering VTMFX also. I'm close to retirement and still trying to get things right as far as asset allocation in different types of accounts. I thought of stock funds in Roth and Bonds in IRA, but really don't want 100% in stocks in my Brokerage as it would tilt me too heavy in stocks.
@@jeffb.2469 VTI and VOO are both good ETFs. I use ETF in my normal brokerage accounts due to their slight tax advantages. I’m five years out so trying to get into the “right” funds/ETFs myself. The “right funds” are different for everyone due to risk tolerance. It makes no sense to go risky if you can’t handle a 50% crash and be able to not panic and hold for recovery. I prefer S&P500 as who am I to argue with Warren Buffet? In my normal Brokerage account I’ve decided to go with VOO and VTEB. I will be moving ever year “4% + inflation” from my Traditional IRA to VTEB every December. This will allow me to control my taxes, ability to adjust later due to RMD, and move any excess from VTEB over to VOO. We’ll have to see how things go but VTI might be option I use for harvesting. For my Traditional IRA after recovery I’m moving over to VWENX. Yes it has a .16% expense ratio but also has an excellent track record and leaves the portfolio and balancing to the professionals. In my Roth, I’m initially going with Warren Buffet’s 90% VFIAX / 10% VBIRX. Since I will have a small pension, traditional IRA, and later social security, I’m comfortably with risk for higher returns.
Hope this helps.
@@Jechum That does help. Thanks.
@@Jechum So, one more thing. Do you think of specific types of accounts to set asset allocation, or do you combine the value of all your accounts, and then determine overall allocation?
Take IRA or 401k first so the survivor does not fall into the widows tax trap. If more money is needed take the dividends from stock and mutual funds and leave everything else alone.
"...you may, perhaps, collect dividends throughout the year and choose to leave them in cash rather than reinvesting them, I think that's certainly, a reasonable approach.". Huh? So...when you retire you freeze your portfolio in that time instead of living off of portfolio growth and dividends?
Yes. I believe that is what the 4% rule laid out by Bill Bengen instructs. The good years will offset the bad years. If you take out too much in the good years, you will sabotage the 4% rule and run out of money.
The question of having too much cash out of the market for a couple months is WRONG! You should ALWAYS have 1 to 2 years cash, cd's, etc, so that when a 2022 happens, you don't have to sell shares. You should pull out of your cash monthly, quarterly, whatever, and let the interest and dividends replenish. If the market drops, and for some reason you need excess funds for some reason, the cash is there, and you build it back up once the market rebounds.
I don’t trust companies like Tiller.
Don't implement it.... Realistically the rule should now be about 2.7%. The US has been crazy lucky, 2.7% would be the "rule" using global market history. Really think the US is going to be as lucky as it has been? I sure don't considering the divisions in society, the aging work force, decreased employment participation rates etc etc etc.
No, that low is crazy and is a result of not understanding the inputs to the analysis and the meaning of the results. Felix is stuck in academic theory, which is no different from practice, at least in theory.
@@Sylvan_dB who is Felix?
@@jeffsim4191 where did you get your 2.7% claim? Ben Felix has been promoting that number on RUclips recently.
In retirement if someone is living off of dividends and interest and sale of stock usually it means at least some (unless they are all Roth) is going to be taxable. That means having to pay estimated taxes (quarterly taxes) usually right?
Great video Rob! I'm far off retirement and having to first hand withdraw in a technical realistic sense, but I have been wanting more information for how to execute it just for my own understanding. Knowing some more specifics into it helps with peace of mind.
The 4% rule is not the way to go imo. Live off of dividends… for those interested in learning the truth about dividends I suggest you check out Genex Dividend Investor channel.