New financial advice for retirees about withdrawals form retirement savings may make sense.
"They often say that people who retire at the age of 65 can safely remove only about 4 percent of their portfolios each year, along with adjustments for inflation. On that basis, the initial withdrawal from a portfolio worth $1 million would be just $40,000.
But some experts have been making waves by suggesting that it may make more sense to withdraw bigger amounts in the early years of retirement.
Ty Bernicke, a financial planner in Eau Claire, Wis., for example, says retirees generally spend less as they age, so that it is reasonable for them to spend more when they are in retirement's early stages. Mr. Bernicke's conclusions, which relied on data from the Bureau of Labor Statistics' Consumer Expenditure Survey for 2002, were published in June in The Journal of Financial Planning (www.fpanet.org/journal/articles/2005_Issues/jfp0605-art7.cfm)."
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