$ for retirement

Dan Murphy · Oct 28, 2004

Originally posted by arminnie
...Most prudent financial planning says that you should not take more than 4-5% of your retirement funds out each year if you want to make sure that they last and don't run out.

For example - if someone has $300,000 of retirement assets they should not plan on taking more than $12-15,000 per year as income. Much more than that and you can seriously run the risk of outliving your assets.

Many people think they can generate 10% retirement income off of their assets - say $30,000/year but that does not provide adequately for cost of living increases and market fluctuation.

I so fully agree, arminnie. I recommend not using more than 4%, preferrably 3%.

And Christine, keep putting it in. The market has been in flux for 5 years now, but certainly historically it goes up, long term. You are buying low and will see the rewards of your course in the years ahead.

Pin Wizard · Oct 28, 2004

Originally posted by arminnie
Sorry for the scary post!

Maybe this will make you feel better. I got totally wiped out financially when I was in my early 40s. I literally lost every penny of home equity, retirement savings, etc in the bust in Houston in the 80s. I lost my job and ended up making half of what I'd made before. When I sold my houses (I had investment property as well as my home) I took terrible losses and ended up owing money to the lender at closing. I was so happy when I finally got my networth back to zero from the minus column.

But I am 58 now and in fairly decent financial shape. Some of it was luck (FINALLY made money on a home sale), but most of it was saving a lot and then moving to a state (Arkansas) with a lot lower cost of living than California.

It's hard to play catch up but it's worth trying.