In the News

Title

Is the Income Replacement Ratio Obsolete?

Document Type

Article

Publication Date

6-7-2017

Abstract

Retirement planning has long relied on two guidelines, the 70 percent "replacement ratio" and 4 percent "withdrawal rate." But no rule of thumb is good all the time, or for everyone, so how are these old rules holding up?

The replacement ratio is the percentage of one's pre-retirement income required to maintain the same standard of living in retirement. It's often been pegged at 70 percent.