Rubino & Liang Wealth Partners

How Safe is Safe?

How Safe is Safe?

That’s an interesting question because each of us takes risks every day. We get in our car. We eat at a restaurant. We walk on an icy driveway. Those are all risks. We build a nest-egg we hope lasts as long as we do. That’s a risk too.

Many of our clients are in their 60’s when they first come to see us. They worked hard. They raised a family. They made some good financial decisions, and some bad ones, but they managed to save a nest egg to live on when they retire.

Here’s the question I hear over and over again from them:

How much can we safely withdraw from our savings every year so that we can live the retirement we want, without running out of money?

So I’ll ask them…Where is your money today? Bank CD’s? Mutual Funds? Stocks? Bonds? Cash?

I get all kinds of answers. I get folks with 100% sitting in cash. I get folks with 100% in the stock market or half in stocks and half in bonds. I even get folks who aren’t even sure of what they have!

And I tell them… I don’t know how much you can safely withdraw from where your money is today. That’s because I can’t predict future interest rates. I can’t predict stock and bond market returns. I can’t predict bank cd rates. Nobody can.

Can you safely withdraw 4% of your portfolio each year? Is that the safe number? That was the conventional wisdom for a long time because it was “safe” between 85% and 90% of the time based on data from the 20th century.

Let me say that another way.  10 – 15 folks out of 100 would run out of money during their lifetime if they followed that conventional wisdom. That doesn’t sound all that safe does it?  And the 20th century didn’t include the 2000 and 2008 stock market crashes.

If it’s important to you to make sure your hard-earned savings last for your lifetime, we can guide you on the right path to a worry-free retirement. For over 25 years, we have helped our clients protect what they have, for now, and for the future. Let us take away the worry. Contact us to set up a free, no-obligation consultation today at 617-630-8787.




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