What factors influence sustainable withdrawal rates?

When Bill Bengen originally coined the term ‘Safe Withdrawal Rate’ in his seminal article in 1994 Journal of Financial Planning, he made some crucial assumptions. He assumed a portfolio invested in 50% US Equities and 50% US Intermediate Bonds. He also assumed a 30-year retirement period, and he took no account of portfolio and adviser fees.

In the real world, we have to account for fees. And we are not limited to a 5050 portfolio or a 30-year timescale.

In this short video, I show how having a different asset allocation, timescale or fee level changes sustainable withdrawal rate from a retirement income portfolio.

Abraham is the Founder and CEO of Timelineapp. He has authored the Beyond the 4% rule book, written several industry papers and delivered many talks. He holds a master’s degree from Coventry University and an alphabet soup of designations, including the Investment Management Certificate, Chartered Financial Planner and Chartered Wealth Manager.

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