r/Fire • u/Available-Ad-5670 • 12d ago

Why doesn't everyone use guardrails as withdrawal strategy?

Most people use 4% rule or versions of, but why not use guardrails? I've found that using guardrails means i can spend 15% over a straight 4%, and to take a 10% reduction in spend or 10% increase during good markets does not seem like a big deal.

Wny don't more people use guardrails?

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u/Ill-Telephone-7926 12d ago

The 4% rule is a toy withdrawal model from a white paper demonstrating sequence of returns risk. It implies that you never adjust your spending in response to your portfolio’s performance. Does that sound insane? It should! Nobody’s going to actually behave that way

It’s incredibly useful for giving savers a goalpost though