How Much Of Your Savings Can You Spend Each Year In Retirement? The Answer, Updated for 2018
For sustainable spending from an investment portfolio, William Bengen’s work is the next natural stop on our journey. Bengen’s seminal study in the October 1994 Journal of Financial Planning, “Determining Withdrawal Rates Using Historical Data,” helped usher in the modern area of retirement withdrawal rate research by codifying the importance of sequence-of-returns risk. The problem he set up is simple: a newly retired couple plans to withdraw an inflation-adjusted amount from their savings at the end of every year for a thirty-year retirement period.
Pfau, Wade D. PhD, "How Much Of Your Savings Can You Spend Each Year In Retirement? The Answer, Updated for 2018" (2018). Faculty Publications. 888.