[{"data":1,"prerenderedAt":107},["ShallowReactive",2],{"term:four-percent-rule":3},{"term":4,"related":94},{"id":5,"title":6,"body":7,"category":76,"description":77,"extension":78,"faq":79,"meta":80,"navigation":81,"path":82,"related":83,"seo":87,"stem":88,"takeaways":89,"__hash__":93},"terms\u002Fterms\u002Ffour-percent-rule.md","4% Rule",{"type":8,"value":9,"toc":68},"minimark",[10,15,19,22,26,29,33,41,44,48],[11,12,14],"h2",{"id":13},"understanding-4-rule","Understanding 4% Rule",[16,17,18],"p",{},"The rule comes from research by financial planner William Bengen in 1994, using historical U.S. stock and bond returns. It implies saving about 25 times your yearly spending gap.",[16,20,21],{},"It is a starting point, not a guarantee: longer retirements, weaker future returns, or high fees may call for a lower rate, while flexible spending makes plans more resilient.",[11,23,25],{"id":24},"example","Example",[16,27,28],{},"To withdraw $40,000 a year, the rule suggests a portfolio of about $1,000,000.",[11,30,32],{"id":31},"in-2026","In 2026",[16,34,35,36,40],{},"Morningstar's annual research puts the safe starting withdrawal rate for people retiring in 2026 at about ",[37,38,39],"strong",{},"3.9%",", up from 3.7% the year before. That assumes a 30-year retirement, a 90% chance of not running out of money, and a portfolio with 30% to 50% in stocks.",[16,42,43],{},"The research also finds that retirees who are willing to adjust spending in bad years can start higher. Morningstar's UK study puts its base case at 4.1%.",[11,45,47],{"id":46},"sources","Sources",[49,50,51,61],"ul",{},[52,53,54],"li",{},[55,56,60],"a",{"href":57,"rel":58},"https:\u002F\u002Fwww.morningstar.com\u002Fretirement\u002Fwhats-safe-retirement-withdrawal-rate-2026",[59],"nofollow","Morningstar: what's a safe retirement withdrawal rate for 2026?",[52,62,63],{},[55,64,67],{"href":65,"rel":66},"https:\u002F\u002Fwww.morningstar.com\u002Fbusiness\u002Finsights\u002Fresearch\u002Fthe-state-of-retirement-income",[59],"Morningstar: The State of Retirement Income for 2026",{"title":69,"searchDepth":70,"depth":70,"links":71},"",2,[72,73,74,75],{"id":13,"depth":70,"text":14},{"id":24,"depth":70,"text":25},{"id":31,"depth":70,"text":32},{"id":46,"depth":70,"text":47},"retirement","A guideline that withdrawing 4% of savings in the first year of retirement, then adjusting for inflation, has historically lasted about 30 years.","md",[],{},true,"\u002Fterms\u002Ffour-percent-rule",[84,85,86],"ira","401k","annuity",{"title":6,"description":77},"terms\u002Ffour-percent-rule",[90,91,92],"The 4% rule suggests a sustainable first-year withdrawal rate.","It implies a savings target of about 25 times annual spending.","It is based on past U.S. returns and is not guaranteed.","saBVSszZ83Q-pIIbKph_v1PUN31a1PIeh_LJx9ASk08",[95,99,103],{"title":96,"description":97,"path":98},"401(k) Plan","An employer-sponsored U.S. retirement plan funded through payroll contributions.","\u002Fterms\u002F401k",{"title":100,"description":101,"path":102},"Annuity","An insurance contract that turns a lump sum or payments into a stream of income.","\u002Fterms\u002Fannuity",{"title":104,"description":105,"path":106},"Individual Retirement Account (IRA)","A tax-advantaged U.S. account for retirement savings.","\u002Fterms\u002Fira",1793374004361]