Suze Orman vs. Dave Ramsey on Sustainable Withdrawal Rates in Retirement
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- Опубліковано 28 вер 2024
- Dave Ramsey recently made headlines by encouraging his listeners to take 8% withdrawal rates in retirement. Many criticized him for it. Suze Orman isn't even recommending the 4% rule, she encourages 3%. Who's right?
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With 22% of Americans lacking retirement savings, I'm seeking advice on growing my depleted $120k.
Evaluate actions harming your finances, like carrying over credit card debt monthly.
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Create a budget with a financial advisor for effective income and expense management.
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Why isn’t Social Security factored in? I know it varies but it’s income that should factor into that $80k.
Great video David!
Thanks Lane!
If you need your RMDs to live, 4% works until you become older and need to take a higher %.
If you have big Roth IRAs and higher SS, then most of your income may be tax free.
Maybe 8% if you retire at age 75
Right.
Are you selling annuities?
We take a balanced, comprehensive approach to retirement planning and at times use annuities when the situation calls for it.
@@DavidMcKnight What % of your customers do you sell Annuities to?
They are high profit for those that sell them. They are scams for those that buys them. The next video will be timeshares.
@@scmsean they're actually not quite as high profit as a 1% management fee which is what most retirees are paying over the balance of their retirement. Only a big deal in the absence of value. Annuities do two things that no other investment can do: guarantee you'll never run out of money and allow you to spend more money than you would by using the stock market approach alone. If those things seem scammy to you, then you should, against the advice of dozens of Nobel laureates from MIT, Harvard and elsewhere, keep putting every last dime of your retirement savings into the stock market.
@@davidmcknight8201 I paid a .004% fee. Annuities have a much lower return and higher fees.
Suzy Orman, if it was up to that witch no one would ever retire.
I retired at 56. Now 70. Been using the 3% rate, with the intent to exceed inflation over time, while increasing my assets. My portfolio now stands 15% greater than inflation over time. Due to personal issues, healthcare aid costs will escalate as my wife and I near our 80s. We'll have the funds to address this.
Well done!
I'm not a fan of Orman, but she can make sense at times. This is one of those times, and I would expect that from her as she is a former CFP credential holder.
She’s been marinating in the system for quite a while. Ramsey has always been outside wending his own course.
When dealing with the subject of financial advice, the concept of "caveat emptor" (buyer beware) rings true. Everyone's situation is different and these financial "rules of thumb" are simply a starting point for discussion. Every now and then, one of these "financial gurus" make such an outlandish statement, such as Dave's 8 % withdrawal rate, that the internet blows up.
If you talk with a financial advisor, and they do not first ask about your goals in retirement, then you might want to seek additional opinions. Do you want to travel the world? Do you want to leave a legacy to your children? How is your health? These things matter.
Very true.
What's wrong with adjusting or alternating years. 3% year followed by a 4% and worked up to 8% on great years and worked back down over a next five years till you go back to 3%. I can't foresee myself every actually retiring bc I do like work but at same time, slowing down would be nice eventually
They’ve done lots of studies on these types of winging-it approaches and they all dramatically increase the likelihood you’ll run out of money prior to life expectancy.
I would not listen to Dave or Suzy. 4.7% is a good number. I am not a big fan of annuities either
Why? If they allow you to take far in excess of 4.7% wouldn’t that allow you to spend more for less?
If you read Suze Ultimate retirement book for 50+. She talk a lot about annuity. 😮
Thanks!
This is why you're my favorite person who covers these topics online. I love Ramsey's 'get out of debt' approach; and I love that you actually provide metrics to this debate on the withdraw amount. And, most importantly, I dont love lifetime annuities but at the same time, they're a great HEDGE investment. Lowest investment with highest return. They're essentially a pension....and everyone either hates them or loves them; you provide them in their just place - a guarantee with the lowest investment costs (and the most limited withdraw scenarios). Thank you for opening peoples' eyes to options!
Thanks for your comment!
It was all good until... annuities.
You’ve bought into the one size fits all financial guru dogma. Annuities have been academically proven to increase retirement income by Nobel laureates since the early 60s.
Two of the most obnoxious people in current media. They are both insufferable.
Topics of my next book.
Especially Ramsey.
Annuity? Why would anyone trust this guy after that.
For the same reasons you would trust Nobel laureates from Harvard and MIT who have been praising the mathematical benefits of annuities since the early 60s. It’s almost as if you didn’t watch the video.
@@DavidMcKnight Once you recommended an annuity I stopped. Advisors always promote those, since they are high profits for the advisors.
Yet dave doesn't recommend any annuity either. & i bet dave is worth a lot more than you.
Absolutely no correlation between Dave’s net worth and the accuracy of his retirement strategy. Case in point, his embrace of 8% distribution rates.
I agree. However if you you are protecting a 65 year old COUPLE with an annuity, the price would be a good deal higher.
Or you could put the annuity on the person who is most likely to live longer if you’re talking about a single premium immediate annuity which I am not.
Don’t know all the details but I have a family member who put a lot of money into an annuity and it went pretty bad for her as she had a big life changing event in retirement and couldn’t access what she needed without penalties.
Yes, not all annuities are created equal. The math has to work.
Love the simple and clear way you explained the different theories and brought in another more attainable option.
Thank you!
Very good video. Thank you
You’re welcome!
I hear annuities are terrible due to lack of death benefit to my heirs. How can I trust any of these talking heads?
Maybe you’re thinking of a Single Premium Immediate Annuity? There are other annuities that can be passed to your heirs.
If you want to leave money to your heirs, use cash value life insurance.
I had a Jackson annuity and the terms were not in my favor. Was able to get out of it and move my money with more favorable terms. Since then, I have never heard too many good things about retirement annuities. I'm somewhat jaded based on past experience.
@@markn1mmo510 your Jackson annuity was most likely a variable annuity with high fees. There are many types of annuities out there. It's a tool that you use for a job. If you have the wrong tool for the job, it won't work.
Hilarious. An insurance pusher and salesman. This is funny.
Anything substantive to say?
@@DavidMcKnight Yeah, never use an insurance salesman as an investment advisor. I know you don't get it because you are indoctrinated in the insurance industry. Do some research.