Let's say you have $500k in savings at the start of your retirement, invested at a 5% rate of return.
You plan to take out 4% a year to top up your other income sources, such as your government benefits. At a rate of 4% out and 5% in, you'll basically never run out.
Not exactly.
Setting aside inflation for a moment, all investment returns come with some degree of volatility. Even a humble savings account, which might offer 1.5% in one year, could easily drop down to 1% the next year, and 0.5% the year after.
It could also rise to 2% the year after that. Volatility isn't all bad, after all.
But it is real, and it can have unexpected impacts on the longevity of your retirement savings if you don't properly account for it.
This is why SafelySpend includes a Margin of Safety in your Retirement Savings Projection that factors in the impacts of volatility.
Combined with your Safe Spending Score, SafelySpend helps maximize how much you can spend and enjoy each year while minimizing the chances of your savings running out.
If you're ready to take control of your retirement spending and protect your savings for the long haul, you're ready for SafelySpend. Click here to learn more and get started.