Ep. 9 - The 4% Rule: Cracking the Code for a Secure Retirement

In this enlightening episode, hosts Jeff Costello and Stephen Bene dive deep into the intricacies of the 4% rule, a strategy that has long been a cornerstone of retirement planning. With pensions becoming a relic of the past and the reliance on 401ks and investment accounts on the rise, the fear of outliving one's savings has never been more palpable among retirees and pre-retirees. The 4% rule, developed in the 90s by financial advisor Bill Bengen, suggests that withdrawing 4% of your retirement portfolio annually (adjusted for inflation) should sustain a retiree through a 30-year retirement. However, with increasing longevity and changing economic landscapes, is this rule still applicable?

Jeff and Stephen explore the origins, benefits, and potential pitfalls of adhering strictly to the 4% rule in today's volatile market and uncertain economic climate. They address the challenges of increased longevity, lower than expected market returns, and the implications of Required Minimum Distributions (RMDs) that could disrupt this withdrawal strategy. Through a mix of expert insights, historical context, and real-world examples, the episode offers a comprehensive look at alternative strategies, including bucket planning, tax-efficient withdrawal strategies, and adjusting to life's unpredictability.

This episode is for anyone looking to understand the complexities of retirement planning, the viability of the 4% rule, and seeking guidance on crafting a retirement plan that accounts for individual needs, market conditions, and the pursuit of a fulfilling post-work life. Join Jeff and Stephen as they demystify retirement planning, providing listeners with the knowledge and confidence to navigate their golden years successfully.

For more information on the 4% rule, please visit: https://www.forbes.com/advisor/retirement/four-percent-rule-retirement/.  

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