More than half our income comes from SS and pensions. For portfolio withdrawals we take what we want or need with an eye on portfolio balance. In 17 years our withdrawal rate relative to portfolio value at date of retirement has ranged from a low of -1.8% to a high of 10.8 percent. Those withdrawals are affected by both deliberate choices and by anticipated and unanticipated necessities. We have a larger portfolio in nominal dollars today than we did at retirement. But the last twenty years at least have been pretty benign for retirees with low inflation and a good stock market. Current retirees who own homes have gained equity, but few are selling.
I can't imagine living chained to some arbitrary financial model for taking withdrawals from a portfolio. A portfolio is a store of wealth obtained by postponed consumption and now being consumed. How fast it can be consumed is a matter of choice and prudence informed by some sense of what behavior can be expected from investments. Sometimes people convert wealth to income streams as illustrated, for example, by buying an SPIA. In theory income streams can be sold, but for Federal pensions and Social Security that is illegal. I don't know about other situations.
I can't imagine living chained to some arbitrary financial model for taking withdrawals from a portfolio. A portfolio is a store of wealth obtained by postponed consumption and now being consumed. How fast it can be consumed is a matter of choice and prudence informed by some sense of what behavior can be expected from investments. Sometimes people convert wealth to income streams as illustrated, for example, by buying an SPIA. In theory income streams can be sold, but for Federal pensions and Social Security that is illegal. I don't know about other situations.
Statistics: Posted by dbr — Fri May 03, 2024 8:23 am — Replies 28 — Views 3123