Why? There is nothing new in making an observation like that.Now I'm terrified ...Keep in mind not to confuse a poor sequence of returns with the bad luck of bad returns over the entire retirement no matter what order they come in.
But if a person really wanted to try they could start with the results here https://engaging-data.com/visualizing-4-rule/ and try to track down in detail what courses of events for returns and inflation resulted in the lowest safe rates of spending historically. Note that for a 60/40 portfolio the worst rate for spending in that data was a withdrawal of 3.8% in 1966 and all other years got to 30 years out without going broke. One could also explain in detail how the highest withdrawal rate was 9.8% in 1877. For more recent experience in that data there is 9.2% in 1982. One would have to tabulate both average real return and also have some way of defining an index for sequence of returns relative to an average return and then relate safe withdrawal rate to those variables.
Statistics: Posted by dbr — Tue Nov 19, 2024 6:56 am — Replies 37 — Views 5789