Page 113 - Ready Set Retire
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Ready. Set. Retire!
impossible to cut our spending, but the truth is
we live in such affluence that we can cut if we
absolutely have to.5
And she isn’t at all repentant, as a more recent quote from her
shows.
Our research shows that retirees who take a ‘set
it and forget it’ approach to their retirement
income strategy do so at their own peril. The
‘dismal decade’ has shown they must remain
engaged and sometimes temporarily fix their
withdrawals in order to maintain a successful
withdrawal strategy over the long term.
Need more convincing? From a January 2013 Morningstar-
sponsored study named, “Low Bond Yields and Safe Portfolio
Withdrawal Rates”:
We find a retiree who wants a 90% probability
of achieving a retirement income goal with a
30-year time horizon and a 40% equity
portfolio would only have an initial withdrawal
rate of 2.8%. Such a low withdrawal rate would
5 Miller, Mark, “Lessons for retirees from the bear market decade,”
Reuters Money, February 16, 2011
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