How much money should I withdraw from my retirement account to live comfortably?

I am 64 years old and I work part time. I am collecting $1,000 a month in Social Security and I have $150,000 saved for retirement. I'd like to start withdrawing from my retirement fund next year. How much can and should I take out per month so I can live comfortably for the next 15 years?

Retirement, Retirement Savings, Retirement Living
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September 2017
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This is a tricky question to answer - how is your $150,000 invested?  If you have it in cash and want it to last for 15 years, the answer is simple- $833 per month.  This is simply assuming very little interest on your 150,000 and divide it by the number of months you are solving for - which is 180.  

If the money is invested conservatively, which is recommended if this is all you have, at say 4%, then the amount you can withdraw to last 15 years increases, but not by much.  At a 4% average rate of return, the math works out to roughly $1100 a month over a 15 year period.   This however does not address any variation or volatility in the investment mix.  And also means there is zero in your account at month 181. If market suffers or you dont earn 4%, money could run out sooner. 

A better way to analyze the definition of living comfortably is to determine how much per month you actually need to be "comfortable".  This will then inform you as to how you should invest the $150,000, if at all, or if you should keep in cash.  

You also need to evaluate what happens after 15 years, is there another pot of money to draw from?  At 64, you are young in determining sustainable retirement income, albeit supplemental over parttime work, as at some point that parttime income will end.  In 15 years, you will still actually be young - only 79 - and could easily live another 15 years.  Evaluation of expenses, longevity & risk tolerance all need to be addressed before making a reasonable recommendation on how much you can take out per month to live comfortably.  

If you need help with these recommendations, seek out a financial planner in your area to help you.  Likely someone who does personal financial planning - not just investments - and can do it for you on an hourly or fee basis.  

September 2017
September 2017
September 2017
September 2017