The Fact That People Still Push the Long-Discredited 4 Percent Rule Shows the Irrationality of Buy-and-Hold
The safe withdrawal rate is not always the same number. The 4 percent rule makes no sense. Those of us who follow the peer-reviewed research have known this for 42 years. Once Shiller published his research showing that valuations affect long-term returns, it was clear to everyone that the safe withdrawal rate is a number that changes with changes in valuations. It’s clear enough. But it’s also controversial. It’s clear in the way that it’s clear that smoking causes cancer and that driving drunk is dangerous and that one should pay attention to red flags before getting romantically involved wi...