How Do I Get My Money When I Retire?

The question we get asked most often is ‘how do I get income from my retirement accounts into my checking account when I retire’? Most people understand the 4% rule, but few ask how investments pay the bills.

The reason is likely because phrases like withdrawal and drawdown strategy are not very sexy. Well, this isn’t going to be sexy. But it will be short and to the point.

The second most popular question is, ‘what about penalties if I retire before 59.5’? That will have to wait until next week!

5 thoughts on “How Do I Get My Money When I Retire?

  1. kyith

    hi, do you think it is a bit risky to rely on the 4% safe withdrawal rate considering that you have not think of the sequence of return risk?

    1. Matt S

      I have to agree that 4% is risky for someone retiring so early. Personally, with a potential for 60 to 70 years of retirement myself, I’m going with a 3% withdraw rate. This of course means you need more saved up before quitting.

      1. Mike And Lauren Post author

        The reason we use 4% is because we expect to continue earning income once we “retire.” For example, if we even earn $500 per month from various income producing hobbies, FireCalc gives our plan a 97% percent chance of success. If we’re not millionaires by 40, we did something very wrong…

        1. kyith

          wow 1 mil by 40. i hope you all reach that. i guess the growth rate in USA is better than where i am from. i think the 4% is a concept that works in your case because it is likely you are not drawing down as much and thus the sequence of return risk doesn’t take place. and since you are not withdrawing, an increase amount of expenses is not impacting big time.

          one thing that many FI folks failed to see is that the inflation of their expenses are perhaps much slower in growth than the average folks.


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