this post was submitted on 17 Feb 2026
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Work Reform

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[โ€“] tburkhol@lemmy.world 10 points 1 day ago (1 children)

The 'mostly safe 4% rule' actually includes inflation. It's based on the assumption that assets are invested in a mix of broad stock market and treasury bonds, and allows the retireee to increase their annual spending by inflation, It usually results in the retiree dying with substantially more wealth (inflation adjusted) than they started out with. The stock market is a natural inflation hedge and, in this day of multinational conglomerates, a currency hedge.

[โ€“] Ava@piefed.blahaj.zone 3 points 23 hours ago

For those curious as to additional reading, the origin of the 4% rule comes from the Trinity Study, a finance research project from the late 90s.

Not to be confused with the Trinity Test, which occurred in the 40s and had very little to do with finance.