Stefan Sharkansky: The Retirement Spending Plan That Adapts as Markets Change

Our guest on the podcast today is Stefan Sharkansky. Stefan is a Ph.D. statistician who specializes in finance. He wrote a provocatively titled paper, “The Only Other Spending Rule Article You Will Ever Need,” which was published in the Financial Analyst Journal. Stefan has also developed a related website called, The Best Third, designed to help people with their retirement spending plans and portfolio structures. In addition, he developed and operates the website PersonalFund.com, which provides proprietary cost analysis of mutual funds to financial advisors. Stefan has a B.A. in mathematics from the University of Wisconsin-Madison, an M.S. in computer science from Stanford University, and an M.S. and a Ph.D. in statistics from the University of Washington.

Episode Highlights

00:00:00 Introduction

00:02:43 Why the 4% Rule Can Lead to Underspending

00:07:23 TIPS Ladders vs. Retirement Annuities

00:08:48 Reducing Fixed Spending and Stock Allocation

00:12:09 Why Individual TIPS Beat TIPS Funds

00:18:53 A Formula for Stock Portfolio Withdrawals

00:23:54 Historical Returns vs. Monte Carlo Simulations

00:29:30 Should Retirees Diversify Globally?

00:32:23 Leaving a Bequest Without Underspending

More From The Long View

Brett Arends: Worried About Outliving Your Money? There’s an Answer

Dana Anspach: Don’t Let Fear Ruin Your Retirement

Bill Bengen: ‘Inflation Is the Greatest Enemy of Retirees’

If you have a comment or a guest idea, please email us at TheLongView@Morningstar.com.

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