But the 4% guideline rests on some important suppositions–first, that your portfolio has a 60% equity/40% bond allocation, and second, that you have a time horizon in retirement of 30 years. If your situation looks much different–for example, you have a lighter weighting in stocks or a longer time horizon–you’d want to be more conservative. The flipside is also true–retirees with shorter time horizons and/or more stock-heavy asset allocations should be able to spend a bit more than 4% initially. This article takes a closer look at the 4% guideline and how individual-specific variables might affect it.
Morningstar presents some interesting ideas regarding your ability to retire comfortably.