Drawdown: safe withdrawal rates

westv

ffacoffipawb wrote: »

Agreed, should be made a 'sticky'.

I guess MSE Towers don't agree.

jamesd

The current way they want things to go is to have just one sticky with links to other threads inside it. I think that the idea in part is so that the sticky threads don't fill all of the initially visible rows, forcing people to scroll to get to the new threads.

BobQ

James,

Thank you for taking the trouble to collate all this.

Thrugelmir

edinburgher wrote: »

I don't think that it's fair to conflate those two (as the main cause for a poorer generation). Surely the death of DB pensions will be a far greater factor in terms of future generations being less well off? A few decades ago, every FTSE100 company had a DB pension scheme, now there are 2-3.

People still made sizable employee contributions to the schemes. One scheme I was a member ( mid 90's) had employee contribution levels of 9%. They weren't simply funded by employer contributions. How many people now save 9% of their salary into personal pension plans? The emphasis has changed for people. Party now and worry pension provision later. Bigger and more expensive housing. Better cars. Long distance travel. All down to personal choice.

bigadaj

Thrugelmir wrote: »

People still made sizable employee contributions to the schemes. One scheme I was a member ( mid 90's) had employee contribution levels of 9%. They weren't simply funded by employer contributions. How many people now save 9% of their salary into personal pension plans? The emphasis has changed for people. Party now and worry pension provision later. Bigger and more expensive housing. Better cars. Long distance travel. All down to personal choice.

That level of contribution would have been unusual then, not so much now.

We can look at the approximate cost of a db scheme being a round 25% of salary which still means the company is contributing far more than most would do to a DC scheme.

Many peoples approach has not varied that much and certainly not in the also two or three decades. It's the fact that db schemes have been closed everywhere apart from the public sector, and significantly diluted even in the latter.

jamesd

I've added this:

Non-essential interesting material

• Guyton and Kitces with Continued Discussions on Safe Withdrawal Rates and Spending Decision Rules, videos that provide some easy enough to follow introduction to a range of issues.
• Year 2000 had the highest 10 year cyclically adjusted price/earnings ratio ever. How Are People Who Retired In The Year 2000 Doing Today? On track is the answer. But also see Guyton's sequence of return risk taming that would have reduced equity holdings substantially, helping them!

mozza78

Can I just say thanks for a very very useful thread!

jamesd

I've added a link to another cfiresim worked example:

Thoughts on my plan please retiring 59, £9500 defined benefit pension, 8k assumed state pension, £275000 investments, desired income £2000 a month, £2250 looks possible.

I've also added a worked example of how to use the 4% rule to calculate approximate monthly pension contributions needed to get to a given target income at and before state pension age.

simonfitba

Appreciate the effort jamesd. Top work fella. This will help a lot of people.

westv

Regarding state pension deferral, is there still much point in doing this if you are married? If retiring after April 16 your spouse no longer inherits any increase so if you were unlucky enough to die before drawing they could end up with a smaller pension pot, if you have used drawdown to fund the deferral, and no benefit.