Does the 4% Rule for Retirement Income Still Work?

May 18, 2025
8 min
Does the 4% Rule for Retirement Income Still Work?
The Annuity Man®
Quick Quote
A real annuity rate with zero strings attached.
Get Started

In this video, Stan The Annuity Man revisits the 4% rule for retirement income to determine if it’s still a viable strategy. Learn about the changes in the market and other factors that may impact the success of the 4% rule for your retirement plan.

Watch and Enjoy,
Stan The Annuity Man

Free Annuity Owner’s Manuals
https://www.stantheannuityman.com/get-smarter/annuity-books

Free Annuity Calculators and Live Rate Feeds
https://www.stantheannuityman.com/annuity-calculators

Book a Free 30-minute Call with Stan The Annuity Man
https://www.stantheannuityman.com/book-a-call

ALL THINGS ANNUITIES
https://www.stantheannuityman.com/

LISTEN/WATCH FUN WITH ANNUITIES PODCAST
https://www.youtube.com/@funwithannuities

#StanTheAnnuityMan
#Annuity
#TheAnnuityMan

0:00
Hi there, Stan the Annuity Man,

0:02
America's annuity agent, licensed in all

0:04
50 states. Glad you joined me today for

0:06
a topic that is needed to be addressed.

0:11
Is does the 4% rule still work for

0:14
retirement income planning? We're going

0:17
to talk about the 4% rule. We're going

0:19
to talk about very very smart people

0:21
that has factually and academically is

0:24
that academically destroyed it. And I

0:28
can do that because I used to be on that

0:29
side of the table. I know you're saying,

0:31
"Stan, what are you talking about? You

0:32
you wear the the Stan the Annuity Man

0:34
logos, the hats, the whole thing. I used

0:36
to work I started with Dean Witter. Then

0:38
I went to pay then it turned into Morgan

0:41
Stanley. Then I went to Payne Weber and

0:43
that turned into Union Bank of

0:44
Switzerland known as UBS. Love all those

0:46
firms. But I'm now in the contractually

0:49
guaranteed only space. Will do not might

0:51
do. But I was in the world of the 4%

0:54
rule. I understood it. I was taught it.

0:58
Um, I talked about it, but at the end of

1:02
the day, I've got a different opinion

1:04
from when I worked for those ivory tower

1:07
firms all over this country, New York

1:09
City and all over um, in my previous

1:12
life before I became the mythical figure

1:14
of Stan. Not mythical, it's actually

1:16
real. Stan the annuity man. So, we're

1:19
going to get into that 4% rule because

1:20
you need to hear what I'm getting ready

1:22
to say after this.

1:29
[Music]

1:32
Okay, so let's talk about what is the 4%

1:35
rule. Stan, sounds good. Sounds

1:36
interesting. Tell me more. Tell me more.

1:39
As I said, was that Greece? Tell me

1:41
more. Tell me more. Okay, let's talk

1:42
about the 4% rule. In the world of

1:46
stocks and ETFs and bonds and markets

1:49
and all that stuff, what advisors are

1:52
taught is don't buy an annuity. Don't

1:54
buy a contractual guarantee. Don't buy

1:56
something like that. Let me the advisor

2:00
manage it. Let me manage it because I'm

2:03
master of the universe. And we'll just

2:05
peel off 4% of the gains for the income

2:09
that you need, sir. And that, you know,

2:12
they'll run Monte Carlos simulations.

2:14
No, that's not the race car. That's

2:16
showing you, well, you know, we ran a

2:18
thousand Monte Carlo simulations showing

2:20
markets and blah blah blah, and this is

2:21
how it's going to work. Life doesn't

2:23
work that way. I mean that's like

2:24
showing me a exercise plan. I got to

2:27
implement the exercise plan. That's not

2:28
going to happen either. The point is

2:30
when you're coming toward retirement

2:32
chapter two, you're, you know, three

2:34
laps out of four, four being retirement,

2:36
you're at three and a half. You're

2:37
rounding the corner. You can see the

2:38
finish line. The 4% rule works in a like

2:42
a charm in a bull market. But when it

2:44
doesn't work in is when it's choppy and

2:47
there's things happening in the world

2:49
that can make markets go up and down and

2:51
you don't have time getting toward

2:53
retirement in chapter two of your life

2:55
to recover from a market loss. Period.

2:58
Okay. Had a conversation today before

3:01
the filming with a a person. He was

3:02
talking about annuities. He said,

3:03
"Should I own an annuity?" I said, "How

3:05
old are you?" And he said, "He's in his

3:06
40s." No, you shouldn't. You should you

3:08
should own stocks and all those things

3:11
and all the growth things because you

3:12
have time for it to recover. The 4% rule

3:16
in my opinion and I'm getting ready to

3:18
tell you who else's opinion which

3:19
matters is dead because of the

3:21
volatility of the markets. If you have

3:23
one or two years where you've lost a lot

3:25
of money in the markets, the 4% rule is

3:28
killing you because you got to take

3:30
money out as you're losing

3:32
money. Don't trust me on this. the smart

3:35
people in the room with the ascots and

3:37
and the got the jackets with the elbow

3:38
protectors and they're in the ivory

3:40
tower and really nice offices with the

3:41
with a receptionist that brings them

3:43
coffee every morning. Those people like

3:45
Wade Fowl, okay, who's been on my Fun

3:47
with Annuities podcast, PF AU, if you

3:50
want to pull it up, he has factually

3:53
destroyed the

3:55
4% sales pitch, the 4% rule. He's like,

3:59
does work. If you want to deep dive into

4:02
and listen to the podcast and how he

4:04
explains it, I would tell you to do that

4:06
or buy his books. Wade Foul, go to

4:08
Amazon, buy his books. The 4% rule is

4:11
dead in my opinion and WDE's opinion and

4:15
others

4:16
opinion. You say, "But wait, but why why

4:18
are why am I still hearing this? Why am

4:20
I still hearing yes, the 4% rule works?"

4:22
Still stick with the 4% rule. Think

4:24
logically. the person managing your

4:26
money is making a fee for managing the

4:29
money, right? Makes sense. Nothing wrong

4:32
with that if if it's up disclosed, etc.

4:35
When annuities for lifetime income are

4:38
put in place that replace the 4% rule,

4:41
you cannot charge a fee on immediate

4:42
annuity. You cannot charge a fee on a

4:44
deferred income annuity, you cannot

4:46
charge a fee on a qualified longevity

4:47
annuity contract, you should never

4:49
charge a fee on an income writer, and

4:51
some people do. for lifetime income.

4:53
Those are contractual guaranteed

4:54
transfer of risk for as long as you are

4:58
breathing. You do not charge fees on

5:00
that. That's the reason that's not being

5:03
recommended because those assets then

5:05
are taken out of what they're charging a

5:06
fee on. The other thing, and this

5:08
nothing against, you know, the masters

5:10
of the universe that are managing money.

5:12
When you're in that world, you you

5:15
believe that you know, you believe that

5:17
you can do it. You believe that you are

5:18
the man. You believe that you are the

5:20
master of the universe. You have to

5:22
believe it to go into it and to do it.

5:24
And historically, there's arguments for

5:27
it. There's aristo historically great

5:28
returns in the stock market. Great

5:30
returns. I have nothing against that.

5:32
And you should keep some of the markets

5:34
if that's what you want to do. But when

5:36
you get to close to chapter two and

5:39
retirement and go and and pivoting and

5:41
going and doing your thing and taking

5:43
care of yourself and taking risk off the

5:45
table, to me, that's when you need to

5:48
pivot away, fork in the road moment from

5:50
the 4% rule and put that lifetime income

5:53
guaranteed floor, that income floor in

5:55
place to combine with the income you're

5:57
getting from the other annuity that you

5:58
own, which is social security, which is

6:00
the best inflation annuity on the

6:02
planet. And if your employer has

6:04
provided you a pension, that's the

6:06
second annuity that you have for

6:07
lifetime income. Do not depend on the 4%

6:10
rule. Here's another reason why. If you

6:12
have the income floor in place

6:14
contractually with lifetime income

6:16
annuities, there's four different types.

6:18
Immediate annuities, deferred income

6:19
annuities, qualified longevity annuity

6:20
contracts, income writers, and not just

6:22
one annuity. I hate all annuities. And

6:24
we can set it up so that 100% of any

6:27
unused money goes to your beneficiaries,

6:29
not the annuity company. So the annuity

6:31
company not going to keep the money. I I

6:33
hate it when people say that. When

6:34
people say, "Well, I'd never buy a

6:35
nudity because annuity company keeps the

6:37
money." It's one of 40 ways to structure

6:38
it, Chester. Okay? We're going to

6:40
structure it so that that money that you

6:43
worked hard for is not going to go poof.

6:46
Okay? It's going to go to your

6:47
beneficiaries. But what I was going to

6:48
say, and this is very important, if you

6:51
put that income floor in place

6:52
contractually that you know is going to

6:54
be there, you know it's going to happen,

6:56
it has nothing to do with the markets,

6:57
guess what? you will be a better

7:00
investor because you don't have to

7:02
disrupt the investments to take the 4%

7:04
out in a down

7:06
year. Makes

7:08
sense. It should make sense because it

7:12
does make sense. Period. So, put the

7:14
contractual guaranteed floor in place

7:18
and then go invest the money. You'll be

7:19
a better investor. Trust me. Trust me on

7:21
that. Think about it. And when you need

7:23
the income floor, look at what you need

7:26
and do you can do a reverse engineer

7:28
quote on my site at theanuityman.com

7:30
using our calculators to use as little

7:32
amount of money as possible

7:33
contractually to solve for that goal.

7:35
And if you need if there's inflation in

7:37
the future, you need to fill in another

7:38
gap, you go in and do it again. You do a

7:40
reverse engineer quote to solve for that

7:42
specific dollar amount.

7:45
So, let me declare right now as Stan the

7:48
Annuity Man, America's annuity agent,

7:50
licensed in all 50

7:52
states with the backing of Wade Fowl,

7:54
smart guy in the room, the 4% rule is

7:57
officially dead. The 4% rule is done.

8:01
The 4% rule needs to be buried. The 4%

8:04
rule needs to be replaced by contractual

8:06
guaranteed lifetime income using annuity

8:10
transfer risk strategies with A+ rated

8:13
carriers or better for lifetime income.

8:16
And if that happens, and it will happen

8:19
because I'm going pound the table out

8:20
here to make sure it happens, you'll be

8:23
a better

8:24
investor. All right. Boy, I got going,

8:27
didn't I? Yeah. And the caffeine's

8:29
wearing off. So, I mean, think about if

8:31
I was really rolling on caffeine. It was

8:32
like

8:33
It's all good. My name is Stan the

8:35
Annuity Man. This is the Stan the

8:36
Annuity Man YouTube channel. Thank you

8:38
so much for joining me. Hit the

8:39
subscribe button and I'll see you next

8:42
time.

8:47
[Music]

related videos

What Is A Life Insurance Annuity?
What Is A Life Insurance Annuity?
MYGAs Are Annuity Bonds: Shootin’ It Straight With Stan
MYGAs Are Annuity Bonds: Shootin’ It Straight With Stan
What Does A 10-Year Certain And Life Annuity Mean?
What Does A 10-Year Certain And Life Annuity Mean?

Talk to Stan The Annuity Man® himself

Get Stan for 30 minutes. No cost for his 3 decades of experience. Prepare yourself for the brutal annuity truth.

Book Your Call with Stan