Six Rules for Customizing Your Retirement Spending Plan

A new withdrawal calculator helps retirees consider various factors

GREAT BARRINGTON, Mass.–(BUSINESS WIRE)–Figuring out how much money to save for retirement is only the first
step. How much can you reasonably spend per year? The answer, says
Research Fellow Luke Delorme, is as unique as the retiree.

The American Institute for Economic Research has created
a new retirement withdrawal calculator
that lets retirees consider
several important factors that will affect how much you should spend
each year. For example, it takes into account retirement age, the level
of risk that you will outlive your money, and how much of your savings
you invest in stocks.

The calculator is accompanied by Delorme’s research
report, “How to Formulate a Retirement Spending Plan,”
released by
AIER on Tuesday. Delorme said factors retirees should consider include:

  • Know that luck plays a big part in how much you have to spend. You
    can’t control stock market performance during your investment period,
    and “chasing returns” can hurt you.
  • The best way to make sure you don’t run out of money is to restrain
    your spending. But that could also mean you’ll die with a good deal of
    unspent money. Consider your appetite for risk in deciding how much to
    spend per year.
  • You’ll also want to consider whether you will need to withdraw a
    specific amount of money each year, or whether you have the
    flexibility to adjust based on stock market performance that year.
  • How long will you need your retirement savings to last? That depends
    on several questions: How long do you plan to work? What is your
    estimated life expectancy, based on your health and gender and marital
    status? Single men, for instance, have a shorter life expectancy than
    a woman or married man.
  • If you have guaranteed retirement income from pensions, annuities and
    Social Security, you’ll have the flexibility to take more risks with
    your investments, and perhaps withdraw more per year.
  • If you pay higher investment management fees or want to leave more
    money to your heirs, reduce your withdrawals.

All these factors are taken into consideration in AIER’s easy-to-use
retirement withdrawal calculator, which
can be found here.

To interview Luke Delorme, contact him directly at 413-645-3327 or email
him at


American Institute for Economic Research
Aaron Nathans,
413-528-1216 x3135