Retirement plan geared to sequence of return risk, what to do when portfolio is rising

Triumph13

An interesting thread for me as I am in a similar position, albeit 7 years post retirement.  We too have a good floor from DB / SP, once they come on line, and planned a fixed percentage withdrawal from an equity portfolio, flowing into a cash buffer, like Linton's, from which we take our annual spending.

I too did loads of modelling of situations where equities dropped, and none for what happens if they do much better than expected.  It's a very nice problem to have, but does take some getting your head around.  In my view there are basically five things you can do with the 'excess':

1. Use it to raise the floor by buying more guaranteed income;
2. Use it to increase the cash buffer to make you even more protected against volatility;
3. Change your asset allocation trading off likely growth for reduced volatility (but presumably you had a reason for not doing this in the first place)
4. Invest it in your drawdown fund, making the volatile income bigger; 
5. Spend it / give it away

Everyone will have their own answer for the right balance, but at the end of the day it almost certainly doesn't really matter - which is why you didn't bother planning for it in the first place.

Bostonerimus1

At 1% drawdown almost any asset allocation from 100% cash to 100% equities will safely cover your expenses even oif you live to be 100. So I would look at the various asset allocation and withdrawal method options you have. Here's a nice starter.

https://www.bogleheads.org/wiki/Withdrawal_methods

There are various methods from the relative complexity of Guyton-Klinger to the simplicity of just taking dividends and interest.