You've saved for decades, but here's the challenge. Your 401 plan does not automatically turn into a paycheck for you. You have to create one yourself, and if you don't do it correctly, you're either going to outspend your portfolio run out of money, or you're going to spend far too little and not fully enjoy what you've worked so hard for. So in today's video, I'm going to show you three simple steps that will allow you to take those retirement savings and turn that into a paycheck that will support your retirement needs.

Now, the steps themselves are simple.

It's the nuance within these steps is what gets people tripped up.

So the steps here are number one, understand your portfolios, sustainable withdrawal rate.

Number two, factor in taxes, and the number three coordinate with other income sources. Now, the steps themselves are simple. It's the nuance. That's where people get tripped up. It's a nuance in here that allows you to optimize this paycheck, and if you don't factor it incorrectly, it could be the thing that caused you to run out of money. So to make this video as helpful to you as it

can possibly be, let's not just look at the steps, but let's apply it to a real example or sample example. Let's take Mary, and let's assume that Mary is 65 years old and she has $1 million in her portfolio, $700,000 of which is in her traditional IRA, $300,000 is in a brokerage account. And of that $300,000, let's assume it's

all in an S&P 500 index fund. Let's make the assumption that she purchased that for $150,000

years ago and it's now worth $300,000. So as we go through these steps, let's actually apply it

to her situation so you can see where the nuance comes into play. So number one, start with

understanding your

portfolio's sustainable withdrawal rate. Why do I say your portfolio? There's all kinds of rules of

thumb or research that shows how much you can spend from your portfolio without running out

of money in retirement. But here's the thing. Not all scenarios are created equal. This largely

depends upon how are you invested and how long are you planning your retirement

to be.

Someone who's already 90 years old can spend a whole lot more from their portfolio than someone

who's 50 years old, simply due to how long they need that money to last for them.

So in Mary's case, let's assume she has 30 years, traditional research, you might have heard

with the 4% rule. The 4% rule says that if you have 30 years, traditional research, you might have heard with 4% rule.

The 4% rule says that if you have 30 years of retirement in front of you, 4% is the amount

you can take out of your portfolio. And even if you retire into some of the worst time periods

that we've ever had here in the U.S., your portfolio would last for those 30 years.

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