n 1954, Harry Markowitz was a graduate student in economics at the University of Chicago and had just finished defending his thesis. Most of the committee accepted his work. But Milton Friedman, an economist with a national reputation, and easily the most influential member of the economics faculty, [...]
Overlooked retirement questions
Personal finance pundits love to debate about “safe withdrawal rates”—the amount a retiree can safely withdraw each year from a portfolio without depleting it too quickly. I agree this is an important topic. In fact, I’ve addressed it a few times myself in recent months. In July I discussed the well [...]
The bucket system
A while back, I described the “4% rule.” This is a popular way to think about portfolio withdrawals in retirement—but it isn’t the only way. Another approach, called the “bucket” system, is also worth understanding. Below is some background on this alternative approach. What is the bucket [...]
Is 4% right for you?
The 4% Rule is one of the most well known ideas in personal finance. But is it really a rule? And does it apply to you? Let’s start at the beginning. The father of the 4% Rule is a financial planner named William Bengen. Back in the early-1990s, he became frustrated with the prevailing rules of [...]
