Originally Posted by
pinseeker
Well, those sentences really didn't make sense, but I think I can figure out what you are trying to say.
You're correct, $3.25M at a 4% ROI will give you $130K for life. Of course, so will a lot less, unless of course, you are immortal, then you will need your scenario.
iPhone typing will do it to you every time.
But the typical ROT on drawing down your savings in Retirement is 4%. Goal is to not withdraw funds so quickly that you bleed your principal to 0$ to early.
Monte Carlo gaming has that as something like an 85-90% chance of the same, inflation adjusted of course, level of spending for 30 years of retirement.
If you're only planning to live for a year, then all you truly need saved is 130k. Would be a huge shift in your lifestyle if a Medical Miracle added another 29 years to your life though.
So, 3.25M * .04 = 130k.
In Practice, rather than a hard and fast rule, better way to budget things is to evaluate how your savings did over the past year and spend a bit more or ratchet things down a bit.
Year by year