Retirees: If This Happened, Could You Run Out Of Money?

We’ve all heard of the 4% rule.

Retirees should be able to withdraw an inflation-adjusted 4% from their portfolio every year.

When doing so, they’re not supposed to run out of money.

But what if this happened during your retirement?

The U.S. stock market doesn’t make money for more than 10 years.

The International stock market doesn’t make money for more than 10 years.

Global stocks crash 51 percent, halfway through your retirement.

Actually, this did happen.

So…how did the 4% rule play out?

Image by Pixabay

You can read the story here


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Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (2nd Ed. Wiley 2017) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use, Privacy Policy and the Comments Policy.

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2 Responses

  1. Andre Pare says:

    Hi Andrew,
    Just a quick question about the 4% rule. Tell me if I am correct, but the way the experiment has been conducted means you only have to establish what the amount is going to be the first year you start to withdraw money and add to it an annual amount corresponding to the inflation. So, you don’t end up with less money the years the market does badly. Am I right?

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