“I Can Point You to Cases Where It Came Very, Very Close to Failing. And, If You Look at the Return Sequences That Turned Up in Those Cases, You Will See That They Were on the Lucky Side. If You Obtained a Slightly Less Lucky Returns Sequence, You Would Have Had a Retirement Failure.”

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

<i>“In many of the return sequences that we have seen in the past, it fails.”

Can you point me to an instance in the past where 4% failed?</i>

No. But I can point you to cases where it came very, very close to failing. And, if you look at the return sequences that turned up in those cases, you will see that they were on the lucky side. If you obtained a slightly less lucky returns sequence, you would have had a retirement failure. People trying to put together retirement plans need to know that. We should not be telling people that an extreme high-risk withdrawal rate is “100 percent safe.”

My sincere take.

Rob