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Don’t Make Me Say I Told You So 245

1. Determine, as accurately as possible, how much income
you’ll need.

Again, difficult to know, but you have to use numbers to make

a reasonable estimate at an answer. Determine the amount
of income you think you’d like to have immediately after you
retire. Not the amount you need just to pay the bills, but

the amount you would like to have in order to live the way

you’d like to.

You then need to take that number and extrapolate it out

over 20, 30, or even 40 years, and assess how inflation will
impact you. Increase the income amount by about 3% per year
to account for inflation.

How Much Can You Withdraw from Your Investments Each

Year?

Here is how long a $1,000,000 investment portfolio will last at

different withdrawal rates:

Chapter 6: Your Action Plan