![]() More recently, Bengen said that by adding small-cap stocks, you could increase your initial draw to 4.5 percent. This was based on Bengen’s analysis of historical investment returns all the way back to the Great Depression. ![]() Published by financial advisor William Bengen in 1994, this “rule” states that if you invest your retirement nest egg in a 50/50 mix of large-cap stocks and intermediate-term Treasury bonds, withdraw 4 percent of the total in your first year of retirement, and then each year thereafter increase the number of dollars you draw by the prior year’s inflation rate, your nest egg will last for at least 30 years. If you’ve been reading about retirement planning, I’m confident you’ve heard of the so-called 4-percent rule. The 4-Percent Rule and How People Try to Update It
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