TITLE

Withdrawal Rules of Thumb Seductively Simple, Yet with Limitations

AUTHOR(S)
Stolz, Richard F.
PUB. DATE
March 2009
SOURCE
Journal of Financial Planning;Mar2009, Vol. 22 Issue 3, Special section p22
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
The article discusses rules for the withdrawal of retirement funds. The four percent drawdown rule popularized by William P. Bengen in his study "Determining Withdrawal Rates Using Historical Data" and his book "Conserving Client Portfolios During Retirement" is analyzed. The question on how useful general rules are for financial planners advising individual clients is addressed. It is noted that such rules are based on historical data and Monte Carlo analysis, but there are intrinsic limits to the usefulness of probabilistic recommendations.
ACCESSION #
37011873

 

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