“We Do Not Yet Have a Case Where Going With a 4 Percent Withdrawal at a Time of Super High Valuations Brought on a Failed Retirement. But We Have a Case Where It Caused the Retirement Account to Be Reduced to $1 at the End of 30 Years (Despite the Fact That This Is an Asset Class That Generates an Average Long-Term Return of 6.5 Percent Real!). And We Can Compare the Return Pattern That Applied in that Case With the Other Return Patterns That Have Applied Over Time and See That It Was Not an Unlucky One. What Happens If the Next One Is an Unlucky One?”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

“This is why I often use the analogy of drunk driving, Evidence. “

Which is a terrible analogy. There are thousands (millions ?) of cases where drunk driving led to death. You don’t need to restrict your analysis to one person who managed to do it without dying.

Whereas there are zero cases where a 4% withdrawal rate failed.

I think the analogy is strong.

We do not yet have a case where going with a 4 percent withdrawal at a time of super high valuations brought on a failed retirement.But we have a case where it caused the retirement account to be reduced to $1 at the end of 30 years (despite the fact that this is an asset class that generates an average long-term return of 6.5 percent real!). And we can compare the return pattern that applied in the case with the other return patterns that have applied over time and see that it was not an unlucky one. What happens if the next one is an unlucky one?

People need to know in advance when a suggested retirement plan carries this much risk. I believe that we need to open every discussion board and blog on the internet to honest posting, without a single exception. I don’t see that one as being optional, I see it as being 100 percent imperative.

My best and warmest wishes to you and yours, Evidence.

Rob