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https://ofdollarsanddata.com/why-the-5-rule-is-the-new-4-rule/
An additional take on Bergen’s new book and data, which I posted about 6-8 weeks ago.
Nothing for me to add except Nick is a smart guy, and the table in the article is pretty compelling.
I’ve read Nick for a few years now, and he just keeps getting better.
I agree, 5% sounds very reasonable.
After reading his new book and running all our numbers through Maxifi and Boldin, we seem to be perfectly fine retiring in the next few years.
I’m happy to go with 5%. The software says we’ll be able to spend more than that until we start taking Social Security at age 70, so we’ll see how it goes.
Anyway, I always tell my wife that in the worst case scenario, there’s always geo-arbitrage 🙂 There are plenty of cheaper places to live than the US if it comes to that.
I’d be hesitant with geo-arbitrage as a back up plan. Gets harder the older you become. Within the US possibly.
I’ve seen too many people who’ve geo-arbitraged from UK to Spain and Portugal even pre-retirement end up returning in a worse real estate position driven by health and proximity to family support.
No intention to start the debate again on this, but depending on your current ages, why take the risk of delaying SS income, when you could smooth things out by starting at FRA even if you don’t need it to spend it thereby increasing the security on your core investments for the future and the stability of your lifestyle perhaps.
That’s one approach. It’s been explained before that as it is the most secure inflation protected income someone will get there are ample reasons to seek to maximise it through deferral as a longevity hedge.
There’s no “risk” in delaying SS income other than in an early death where one may not have had payback, but that rather puts financial considerations in the shade.