Rethinking retirement

RETIREMENT planning used to go like this.

Once people start work, they embark on the so-called accumulation phase. Over 30 to 40 years, they maximise their earnings potential and save up their nest egg.

Then they retire and the drawdown phase begins. On average, people have roughly 20 to 30 years to spend their savings before they die.

In the drawdown phase, retirement planners have traditionally assumed a 4 per cent withdrawal rate. This describes the proportion of your retirement assets you can safely withdraw in your first year of retirement.

To put this rule i…