The 4% withdrawal rule has traditionally guided retirees, suggesting they withdraw 4% yearly from their portfolios. However, its viability is increasingly questioned as it may lead to a restricted and less enjoyable retirement. Many are now turning to the 8% rule, which allows them to access their funds sooner but demands higher investment returns. Opting for the 8% strategy may lead to earlier retirements, providing more time for health and travel. This shift spotlights the need for individuals to evaluate their financial situations more aggressively.
The 4% withdrawal rule has served retirees for years, but with the rising popularity of the 8% withdrawal strategy, its appeal is waning in retirement planning.
While 4% provides a safer route, many feel constrained by that budget, thus leaning towards the 8% rule that enables earlier retirement.
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