The Wall Street Journal article, “Say Goodbye to the 4% Rule” gives a startling example of the importance of income planning.
“If you had retired Jan. 1, 2000, with an initial 4% withdrawal rate and a portfolio of 55% stocks and 45% bonds rebalanced each month, with the first year’s withdrawal amount increased by 3% a year for inflation, your portfolio would have fallen by a third through 2010, according to investment firm T. Rowe Price Group. And you would be left with only a 29% chance of making it through three decades, the firm estimates.”
Retire at the wrong time and follow the 4% rule blindly… you could end up with a 67% chance of running out of money. If that isn’t an endorsement for using a professional to help you manage your portfolio on a yearly basis… I don’t know what is!
You can find the article by simply Googling, “Say Goodbye to the 4% Rule Wall Street Journal”.