Zebra Smash - Real Financial Planners | Real Conversations

While attending the NAPFA National Conference in Bellevue, WA, Roger had the privilege of sitting down with Bill Bengen,  one of the true financial planning legends. (Ben had the privilege of sitting comfortably in his home.) Bengen's landmark 1994 paper in the Journal of Financial Planning introduced the world to the now-famous "4% Rule", which stated that based on historical returns for stocks and bonds, a retiree who withdrew no more than 4% (actually, 4.2%) of their initial portfolio and then adjusted future withdrawals by inflation had the greatest chance of not outliving his or her funds.  And just like Louis XV, after Bengen came the deluge of researchers - including Bengen himself - who revisited, and refined the concept of Safe Withdrawal Rates. And many a PhD was hooded... In this episode, we touch on: Bengen's motivation to research safe withdrawal rates Data sources available at the time Strengths and limitations of the 4% rule  The role that taxes and tax-deferred accounts play on Safe Withdrawa