Page 111 - Ready Set Retire

Ready. Set. Retire!
study by T. Rowe Price (that you will never hear of...except
here!) has determined that after the first decade of this century,
the best case scenario is a 43% chance of success (success as
defined as not being broke) when taking 4% a year with a 3%
COLA. And that’s only if you will reduce your payout by 25%
for three years after each market bottom. If you continue the
original plan without making adjustments, you face a 94%
failure rate (94% of the time you are totally hosed!).
See the results of the study below.4

Figure 22: T. Rowe Price Dismal Decade Study

4 Dismal Decade Offers Cautionary Lessons for Retirees, Study authored
by T. Rowe Price, 1/2011

101