Many people find themselves nearing retirement without much money socked away in savings. This is unfortunate, but hopefully, you’re in a much different boat.
Maybe you’re approaching retirement with a $500,000 nest egg. Or perhaps you’ve managed to amass $1 million in your IRA or 401(k) plan.
No matter how much savings you’re bringing with you into retirement, it’s important to make sure that the money lasts. And that means ignoring one glaringly outdated rule and opting to follow a more appropriate one.
For many years, financial experts talked up the 4% rule in the context of retirement savings. The rule was simple and went as follows: In your first year of retirement, you’d withdraw 4% of your IRA or 401(k) balance. You’d then adjust all subsequent withdrawals to account for inflation. If you stuck to that system, you’d be setting yourself up to have your savings last for 30