The Historical 4% Retirement Savings Withdraw Rate May Not Hack it for Present Day Retirees

If you’re retired or going to be, there’s a rule of thumb covering the money amount you should withdraw from your savings yearly to maintain your retirement lifestyle.

That rule of thumb amount is 4% yearly drawn from your retirement savings you should take out to cover your spendable income.

This concept was developed by financial advisor William Bergen in 1994 who said that the 4% withdraw rate would be safe and secure for an average couple ‘s retirement savings over the lifetime of 30 years.

Since then, most financial planners and brokers out there have advised clients that the “4% rule” is gospel. However, what worked in the nineties does not apply today. In fact, latest research says that the historic 4% annual withdraw rate may jeopardize retiree savings so much so that many will be in danger of outliving their income.

More and more financial experts are recognizing the 4% rule is twice the amount the average retiree should take out of his/her retirement fund without depleting family’s assets.

The safest level today and the future forecast is around 2% for retirees who have limited savings assets for a successful long -term retirement.

Your life span plays an important role in determining if this rate is going to be sustainable, as retirees who live longer need their portfolios to last a longer period of time, and medical costs and other expenses can increase as retirees age.

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Author: David Wilkinson

Web master: web site is www.mktingco.com...Creates marketing concepts for small businesses targeted around web site design and follow on customer building concepts like email marketing, use of social media, media coverage and search engine optimization. In addition, Wilkinson is a bookwriter. Along with his brother,Don, David has written and published two business books: "Stop Wasting Your Wealth in Mutual Funds." and "Rollover— Make Your Retirement Savings Last Longer Than You Do" Second book schedule to be published in February 2017.

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