The World Isn’t What It Was in 1995 — and Neither Are You
Back in 1995, the average life expectancy in the U.S. was around 75 years. Today, it’s closer to 80 — and for many healthy adults, living well into their 90s is absolutely possible. That means your “retirement years” could easily stretch to 30 or even 40 years.
That’s not just a longer vacation. It’s an entirely new stage of life — and it demands a new approach.
The old idea of retiring, withdrawing 4% of your portfolio each year, and expecting it to last until you’re gone doesn’t hold up as safely as it used to. Markets fluctuate more sharply, healthcare costs rise faster than inflation, and traditional pensions are far less common.
But here’s the good news: today’s retirees also have more freedom, better tools, and more opportunities to design a lifestyle that truly fits them.
The 4% Rule Isn’t a One-Size-Fits-All Plan Anymore
If you’ve read about retirement planning, you’ve probably heard of the “4% rule.” It’s the classic guideline suggesting you can safely withdraw 4% of your savings per year (adjusted for inflation) without running out of money.
While this rule worked for decades, today’s economy is a bit different. Market volatility, low bond yields, and longer retirements make this formula less reliable.
That doesn’t mean you need to panic — it just means you need to personalize it.
Instead of thinking in terms of a strict percentage, think in terms of flexibility:
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How much do you really spend each month?
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Which expenses are essential and which are optional?
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How can you adjust during years when the market is down?
Running a few “what if” scenarios — like what happens if the market drops 20% early in retirement — can help you plan for the long haul with confidence.
It’s not about strict math. It’s about adaptability.
