Letter to the Editor: Retirees Would Need $1 Million For That

Gary M. Albert writes: This is in response to Jim Connolly’s January 2008 feature article (How prepared are advisors to meet the income planning challenge?). Personally, I am looking forward to dispelling the old beliefs of 4%-5% withdrawal rates from retiree assets. It never made sense to me in the past and it doesn’t now.

For someone to receive $40,000 a year as an income stream from their own assets, they would have to have $1,000,000 in an account. Not many have that much money in an account. Thus, the old rule won’t work! I am waiting for that day with a plan that makes sense.