How this number is made
Retirement income from a portfolio is a percent of the portfolio. The percent is the decision. Four percent is famous and is not mandatory. This page turns the percent into a year and a month. It does not inflate later years.
- Use the portfolio you will actually draw from.
- A lower percent lasts longer in bad markets and spends less now.
Formula
Yearly = portfolio × percent. Monthly = yearly ÷ 12.
Worked example
With the figures already in the form, per month is $1,895.83.
Questions
How is this different from the 4% page?
Same math, with a default under 4% so the percent is obviously a choice. Neither page simulates a market.
Do I withhold tax?
From a traditional account, yes, you should plan to. This withdrawal is pre-tax.