How are early retirees suppose to achieve 4% SWR?

Rob's vision of "honest and informed debate" doesn't include answering simple and straightforward questions put to him. The unanswered questions cataloged here are an important part of Rob Bennett's Passion Saving, Hocomania.

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How are early retirees suppose to achieve 4% SWR?

Postby Schroeder » 09/20/07 at 08:57:12

Hocus was recently featured in an MSN article by Liz Pulliam Weston. It was discussed here on REHP on this thread . . .


The article discusses the 4% SWR Rule . . .

Cut-Throat wrote:
The Bennetts started looking at every expense in terms of how much more quickly they could reach their retirement goal.

It takes $75,000 to earn $3,000 a year in interest income, assuming a 4% return. Each $3,000 in annual expenses that Rob's family cuts means they have to save $75,000 less for retirement -- thus moving their financial independence closer to reality.


Well, he does believe in the 4% SWR Rule!

However, hocus appears to be unwilling to answer a basic question . . .

Schroeder wrote:
hocus wrote:Well, he does believe in the 4% SWR Rule!

Uh, good point, Cut Throat!

Rob

I don't understand. The 4% SWR rule is for 30-year retirements starting at age 65, right? But the article was about Early Retirement! So we're talking at least another 10 years to be added to that "standard" 30-year timeframe, right? In other words, early retirement starting at, say, age 55, would be a 40-year retirement.

[highlight]How are early retirees (starting at age 55) supposed to achieve a 4% SWR?[/highlight]

Pardon me for saying this, hocus. But I think you may live to regret advising early retirees to use the 4% SWR rule. You may be responsible for thousands of busted early retirements in days to come. :o

Schroeder

Hocus evades the question . . .

Schroeder wrote:
hocus wrote:I think you may live to regret advising early retirees to use the 4% SWR rule.

It takes something pretty darn far out there to stun and amaze me at this point, Schroeder. If I someday get banned from a board for being too big a supporter of the Old School SWR studies, I think that just might flip the switch.

Rob

Now I'm really confused. We know that you are not a big supporter of Old School SWR studies which showed that 4% SWR was safe in the past for 30-year retirements. Yet you told Liz Pulliam Weston and her readers that a 4% SWR is perfectly reasonable for early retirees!

How do you explain that, hocus?

Even the Old School SWR studies do not make claims to 4% as being safe for early retirees, defined as someone retiring at age 55 and planning for a 40-year retirement.

Schroeder

Hocus again evades the question . . .

Schroeder wrote:
hocus wrote:Now I'm really confused.

I understand, Schroeder.

Rob

With all due respect, hocus, you don't understand. If you really do understand, why not answer my question? Here, I'll repeat it for you . . .

We know that you are not a big supporter of Old School SWR studies which showed that 4% SWR was safe in the past for 30-year retirements. Yet, you told Liz Pulliam Weston and her readers that a 4% SWR is perfectly reasonable for early retirees!

How do you explain that, hocus?

Even the Old School SWR studies do not make claims to 4% as being safe for early retirees, defined as someone retiring at age 55 and planning for a 40-year retirement.

Schroeder

And that was that. Also on that thread was a link to contact Ms. Weston, the author of the article . . .

Cute Fuzzy Bunny wrote:http://www.asklizweston.com/contactLiz.html

I took the opportunity to send Ms. Weston an email telling her of my attempt to find out more about the claim that 4% is a safe withdrawal rate for early retirees. I included a link to the thread showing that hocus evaded my question. I also made a request to Ms. Weston to write a follow-up article to address how early retirees might achieve a 4% SWR.

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