I Retired at 61 on a $145K Salary. How Much Can I Safely Spend Each Year?

Core Insights - The article discusses the financial preparedness of a 61-year-old retiree with a strong financial foundation, including nearly $2 million in a 401(k) and significant liquidity, indicating readiness for a long retirement [1] Withdrawal Strategies - The 4% rule is a common guideline for retirees, suggesting a withdrawal of 4% of the initial portfolio annually, which would yield approximately $145,000 per year from a $3.6 million portfolio [7] - Given current market volatility and upcoming college expenses, a more conservative 3% withdrawal rate is recommended, providing about $108,000 annually, which is still substantial [8] - A financial advisor can help tailor withdrawal rates based on individual spending expectations and comfort levels, with a range of 2.5% to 3.0% being reasonable [9] Financial Flexibility - The retiree's spouse is still working and contributing to a seven-figure retirement plan, providing additional financial security and flexibility [5][10] - The option to continue working for another 5 to 10 years remains available, which can help mitigate financial pressures from market fluctuations or rising college costs [10] Market Considerations - Rising market volatility due to tariff concerns suggests a cautious approach to withdrawals, emphasizing the importance of maintaining a conservative investment strategy [6] - Adjusting withdrawal rates based on market conditions and expected large expenses can enhance financial stability during retirement [11]