About This Episode

The 4% Safe Withdrawal Rule was created as a guideline for how much you can withdraw from your portfolio in each year of retirement without running out of money.

In an ideal world, following the 4% rule would allow you to plan your retirement cash flows in a way that ensures your investments can support you throughout retirement. But as with all generalizations, the 4% rule comes with both advantages and disadvantages.

Today we’re exploring how the 4% rule came to be and whether it’s still valid for Canadian investors in 2022. Keith is joined by his colleague, Lawrence Greenberg, who is part of our next-generation advisory team. Together, they discuss the intricacies of this financial theory and whether or not it is applicable in all economic environments.

Key Topics:

  • Why we’re discussing the 4% safe withdrawal rule (1:47)
  • The meaning and origin of the 4% rule (2:25)
  • Modifying the 4% rule for early or late retirement (6:14)
  • Why the 4% rule has become a fascinating concept for Canadian investors (7:26)
  • What the research tells us about the retirement readiness of the average Canadian (8:43)
  • Your burn rate versus the 4% rule (10:40)
  • The benefits of figuring out your burn rate (13:55)
  • Why the 4% rule needs to be adjusted in the current market landscape (15:12)
  • The impact of current stock valuations and bond yields on future safe withdrawal rates (16:08)
  • Critical factors that are not accounted for under the 4% rule (17:34)
  • Variable withdrawal rates (19:04)
  • One of the main criticisms of the 4% rule (21:06)
  • Our approach to planning retirement cash flows (22:18)
  • The three stages of retirement spending (23:23)
  • Our key takeaways (25:49)
  • And much more!

Meet your hosts

Keith Matthews

Keith Matthews

Partner & Portfolio Manager

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Marcelo Taboada

Marcelo Taboada

Associate Portfolio Manager

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Lawrence Greenberg

Lawrence Greenberg

Associate Portfolio Manager

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Thanks for Listening! Be sure to subscribe on AppleGoogleSpotify, or wherever you get your podcasts. And feel free to drop us a line at lawrence@tma-invest.com or 514-695-0096 ext.112 Follow Tulett, Matthews & Associates on social media on LinkedInFacebook, and more! Follow The Empowered Investor on FacebookLinkedIn, and Instagram

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