Preparing financially for retirement should be anyone’s job. During retirement, important expenses such as health insurance and medication increase and we must have resources to cover them. But what is the amount needed to support your retirement?
The 4% rule proposed by William Bengen is a well-accepted model abroad, especially in developed economies. As its rate of return assumptions are close to the current Brazilian reality, its model can be extrapolated to Brazilian cases. The study takes into account income from fixed income, scholarship and inflation rate.
Bengen reveals that it is possible to withdraw 4% of its financial resources per year and still have these resources corrected for inflation year after year. In other words, with R$300,000 in investments, you can withdraw 12,000 a year without affecting your investments. The idea of the model is to withdraw only part of the interest for consumption, so your equity will remain intact.
