I know the title is going to provoke responses of "there's no such thing as a guaranteed return," but see explanation below. Assuming your 401k/403b has an option that pays 7% annually with 0% volatility, how does that affect your SWR analysis? I'm trying to help my parents plan annual spending (they've been doing it purely on vibes), and they basically have job based pensions, SS, and this retirement account that's fully in this 7% fund. 4% for this asset seems right if you assume 3% inflation. Is it that simple?
Explanation: my parents are retired NYC school teachers, and their 403b has a "fixed return" option that pays them a guaranteed 7%. Here's a link to it https://www.trsnyc.org/memberportal/Investments/FixedReturnFund. In fact, if the underlying fund doesn't make enough to support the return, NYC taxpayers make up the shortfall. Conservative policymakers hate it. See this link:https://cbcny.org/sites/default/files/media/files/ExpensiveRiskyBenefit-TDA_0.pdf
[link] [comments]