What percentage of retirement assets should a couple withdraw monthly at age 65? Are there good guidelines?

I'm trying to help my father plan his retirement finances and I'm looking for good guidelines to help him evaluate his strategy.

Public Comments

1. That's a very good question. There's a paper published on AAII.com which discusses this issue. In the paper, the author runs simulations on historical data and how much withdrawal rate would be more likely to sustain the portfolio for the entire retirement. For a 50/50 stock/bond portfolio, withdrawing for 30 years, the success rate is 98% if withdraw 6% of the total value at the beginning of retirement. A very general rule of thumbs is to withdraw 5% or less, 3% to be on the safe side.
2. I have seen several articles that indicate the withdrawals should 5% or less. Of course once you reach 70 1/2 if you have an IRA or 401K the withdrawal rate is set for you by the IRS. I have been using that rule for the last 10 years and it seems to work pretty well.