The Famous 4% Rule for Retirement Doesn't Work for Me. Here's Why -- and What I Plan to Do Instead

Core Insights - The article discusses the importance of saving for retirement and the challenges associated with traditional withdrawal strategies like the 4% rule [1][2][3] Group 1: Retirement Savings Strategies - The 4% rule is a common strategy for managing retirement savings, allowing for a 4% withdrawal in the first year and adjusting for inflation thereafter [3][6] - The 4% rule is criticized for its rigidity, as it does not account for varying spending needs throughout retirement [4][7] - The author suggests a need for a more flexible withdrawal strategy that allows for larger withdrawals in the early years of retirement, followed by reduced spending later on [5][7] Group 2: Concerns with the 4% Rule - The 4% rule assumes a balanced portfolio of stocks and bonds, which may not be applicable to all retirees [4] - The rule is based on the assumption that retirees will need their savings to last for 30 years, which may not align with individual retirement plans [4] - The lack of flexibility in the 4% rule is highlighted as a significant drawback, as it does not accommodate changes in spending patterns over time [5][6]