Question about 4% rule: I’ve noticed that banks are now offering 4% in savings?

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  • #83021 Reply
    Taylen

      My question is, would it be wise to park money in the bank after you reach your financial goal to start living off of 4% or keep the money invested?

      #83022 Reply
      Cortland

        The 4% rule is what you withdraw and also a savings account offering 4% is not permanent.

        #83023 Reply
        Gerald

          No that would be idiotic. Nobody is offering a 7% guaranteed return for 50 years which is what would be required to provide 4% plus 3% inflation. As soon as a bank offers a 50 year 7% note backed by the us government or FDIC wake me up.

          #83024 Reply
          Aaron

            Nope not going to be doing that. Others have outlined the answers – main reason Is that the 4 percent rule is not based on your money returning 4 percent in the investments.

            #83025 Reply
            Andrea

              That 4% will be short lived.

              #83026 Reply
              Mike

                The rule assumes you make 6-8%, and only withdrawal 4% of it, so you’re always outpacing inflation and making up for down years in the market.

                You can’t just make 4% and take out 4% because you’ll be buying less stuff over time.

                Also, savings accounts will not average 4% over the long run. Once the fed cuts the rate, it’ll drop.

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              Reply To: Question about 4% rule: I’ve noticed that banks are now offering 4% in savings?
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