Talk:Sustainable withdrawal

Perpetual withdrawal rate

Is sustainable withdrawal rate different than perpetual withdrawal rate (the more common term)? I see them used interchangeably. I also note that perpetual withdrawal rate is not in the Bogleheads wiki, but it is discussed in the Bogleheads forum. --LadyGeek 13:55, 29 January 2024 (UTC)

No, "sustainable" in the present context means that an initial rate of 3%, or 4%, or whatever (4% of the initial portfolio), is converted to a constant dollar amount of withdrawal, ajusted yearly for inflation, and that this dollar amount can be taken out for 30 years (not in perpetuity) without completely depleting the portfolio, based on historical data or simulations. The best name for this method is actually "constant dollar". I've made this explicit in the section on initial studies but it might need to go in the lead section as well.--Quebec 14:40, 29 January 2024 (UTC)

Thank you for the explanation. A section explaining the difference, i.e. sustainable withdrawal is not perpetual withdrawal, would be helpful. The Bogleheads wiki page Safe withdrawal rates could then be clarified. --LadyGeek 15:17, 29 January 2024 (UTC)

Please see the new sentence at the end of the lead section. --Quebec 23:47, 29 January 2024 (UTC)