Bengen now says SWR is 4.7%

But he’s using a third party market timing service to tell him when to get in and out of the market [LOL]

If he just stuck with 4% back in 1994 and didn’t market time, he’d have over 4 times his starting balance today after 28 years of withdrawals.

Article from Financial Planning Magazine

Podcast on Twitter


I’d define him as a “fraidy cat”. Which was a good thing in that it inspired him to determine what was the true historical safe withdrawal rate. But it’s been a bad thing for him because he’s been flailing around as a market timer, both to the detriment of his own wealth, his clients’ wealth and to his credibility. His work is still credible, but because he doesn’t eat his own cooking, it does kind of make him suspect.


Hoco-service perhaps? :joy:


Looks like he says that this higher SWR is with a lower percentage of stocks in portfolio (~60 rather than 75%?).
what is enabling him to say this? (a little) more historical data?
a different portfolio composition (more weight to small and micro caps?)?
What if one has a 100% stock portfolio? Would those SWRs work over a few decades? What conclusion can be drawn from these type of studies?


I trust you are aware Bengen does not follow his own advice.

The bottom line is that 4% or 25x-what-you-spend is an excellent target for saving. Once you reach retirement, 4% is more of a fuzzy concept that requires real-world “resets” from time to time, at the very least. As to Bengen, he deserves credit for being the first to use computer power to figure this out. Beyond that, he’s pretty worthless, as he’s because a market timer who doesn’t eat his own cooking. I label him a “fraidly-cat”, which is probably what inspired him to mine the 4% data, but also seems to be his personal financial undoing.


Bengen’s 4.7% SWR assumes broader diversification beyond the S&P 500 and bonds. Also, there are mutual funds available today with lower expense ratios vs. 1994 when Bengen did his original work.

I like this PortfolioCharts site that chooses the lowest cost mutual funds to build a few standard retirement portfolios.