Choose the appropriate Withdrawal Rate
Choosing the appropriate withdrawal rate is another strategy for ensuring that your investments
continue to meet your income needs throughout retirement.
To help slow the erosion of your nest egg, a common guideline is to set your withdrawal rate equal
to the rate of return achieved in your portfolio, minus your personal inflation rate. In addition,
by including growth-oriented investments in your portfolio, you may be able to withdraw a higher amount
than if your portfolio was solely invested in more secure investments.
In the example below, the portfolio generates an average annual rate of return of 5%.
If you withdraw less than the average annual rate of return, your assets continue to grow;
withdraw more, and they begin to erode.
If you think you'll need more cash flow to meet your retirement needs, or want help choosing the
withdrawal rate that’s right for you, speak with an RBC financial advisor.
Please stop by your nearest branch and ask us to review your retirement income plan with you,
or reach us by phone at 1-866-365-2123. RBC has a lineup of retirement cash flow solutions to
help you make your assets last so you can retire with confidence.
Important information about our financial planning services can be found at the bottom of our
homepage.
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