For a generation of savers, the 4% rule has been treated as a hard ceiling on what they can safely spend in retirement. Now the rule’s creator, financial advisor Bill Bengen, is arguing that many especially early retirees may be leaving meaningful money on the table if they cling to that limit without looking at their actual risk profile. His updated research suggests some can start closer to 4.7% and still sleep at night, provided they understand the trade offs and are willing to adjust along the way.
That shift matters most for people who have sacrificed aggressively to leave work in their 40s or 50s, only to live as if their nest egg is perpetually on the brink. Instead of treating 4% as sacred, Bengen now frames it as a starting point in a wider range, one that depends on inflation, market valuations, and how flexible a retiree can be when conditions change.
How Bill Bengen moved from 4% to 4.7%
When Bill Bengen first developed what became known as the 4% rule, he approached the problem like an engineer, testing 400 retirement scenarios to see how much a portfolio could withstand. That work produced an original safe withdrawal rate of 4.17%, which he later rounded down to the simpler 4% rule that spread through the financial planning world. In a later discussion of his updated work, one community of investors noted that Bengen’s new book lifts that potential safe withdrawal rate from the original 4.17% to as high as 4.7% for certain portfolios, reflecting a deeper dive into historical data.
In a detailed breakdown of his revised work, Bengen now explicitly advocates a 4.7% rule, not 4%, for retirees who match the assumptions in his models. A separate analysis of his new guidance describes how he updated the classic framework, with one report summarizing that “Bill Bengen Updates the Rule: The New 4.7% Safe Withdrawal Rate for Retirement” in the context of the Lange Report August review. Another overview of his revised research notes that he is now comfortable revising the rule to 4.7 percent after stress testing roughly 400 historical market sequences, concluding that this higher rate still preserved the life of a portfolio in the worst cases, as detailed in a technical review.
Why early retirees may be “cheating themselves”
Bengen’s most provocative recent argument is aimed squarely at early retirees who built their plans around a rigid 4% ceiling. In a new interview, he warns that people who leave work in their 40s or 50s and then lock themselves into ultra-frugal budgets may be “cheating themselves” out of experiences they could afford, because their portfolios can likely support higher initial withdrawals if they are monitored and adjusted. That message is captured in a report on why early retirees may be shortchanging their lifestyle, where the piece notes that the story was Published Thu, Dec 18 at 1:57 PM EST by Ryan Ermey, with imagery credited to Karrastock and Moment, and it highlights Bengen’s view that many early retirees can safely draw more than they think.
His updated stance is not a blanket invitation to spend freely, but it does challenge the culture of extreme caution that has grown up around the 4% rule in communities like FIRE. In one discussion thread titled “The Father of the 4% Rule Finally Sets the Record Straight,” users point to Bengen’s own comments and emphasize that some of the harshest critiques of his work are attacking a caricature he never endorsed, with one commenter calling that misreading a straw man while linking directly to Bill Bengen’s clarifications. In a separate long-form conversation, Bengen explains that his research was always meant to be a guide, not a prison, and that retirees should consider their own tax situation, such as whether they live in a state that does not require them to pay state income taxes, when deciding how aggressively to draw down assets, a nuance highlighted in a detailed Q&A with Bill Ben on Financial Samurai.
Inflation, flexibility and the new “safe” range
Even as he raises his recommended starting point, Bengen is clear that inflation remains the biggest threat to retirees. In a recent profile, he calls inflation retirees’ “greatest enemy” and stresses that any safe withdrawal framework has to account for long stretches of rising prices that quietly erode purchasing power. In that same discussion, he notes that with his new book “A Richer Retirement,” he now believes that today the maximum safe withdrawal rate is higher than 4%, provided investors accept that they may need to cut back later if inflation or markets turn against them, a point underscored in a detailed interview.
Other analysts echo that the safe withdrawal rate is no longer a fixed 4% carved in stone. One widely shared essay on “The Three Personal Finance Ideas That Quietly Took Over 2025” notes that “The Safe Withdrawal Rate Quietly Got Bigger,” arguing that the shift away from a rigid 4% ceiling has already happened by 2025 as more planners adopt dynamic spending rules that respond to market conditions, a trend summarized in the section titled The Safe Withdrawal Rate Quietly Got Bigger. At the same time, some research still urges caution for those retiring into expensive markets, with one analysis warning that relying on a flat 4% rule could cost new retirees and suggesting instead a 3.7% starting withdrawal rate for people leaving work at the end of 2023, as laid out in the Key Takeaways from Morningstar’s modeling.
What critics and supporters say about a higher rate
Bengen’s new 4.7% target has sparked a predictable split between those who see it as overdue and those who worry it is too aggressive. A concise summary of the debate asks whether it is possible the 4% rule is all wrong, noting in its Key Points that William Bengen now says a withdrawal rate of 4.7% may be more appropriate and that retirees who can cut back a little during downturns can afford to start higher. Another analysis of what everyone gets wrong about the 4% rule emphasizes that Bill Bengen, often called the father of the rule, agrees that a 4% withdrawal rate does not work for everyone and that most people should begin by asking themselves a series of questions about their goals, risk tolerance, and desired legacy before picking a number, a perspective laid out under the Key Points in that piece.
Other experts remain more conservative, especially for retirees with modest savings or limited flexibility. A planning guide from Fuchs Financial notes that “Many financial experts now say this shouldn’t be a fixed rule,” explaining that some retirees might find 4% too high while others might safely spend more depending on their personal situation and market conditions, a nuance captured in the line that “Many financial experts now say this shouldn’t be a fixed rule” and that “Some retirees might find 4% too high.” A separate primer on managing money after you retire points out that “4 Some experts have questioned this rule, maintaining that 2% or 3% is a more realistic figure,” while “Other experts set a safe withdrawal rate even higher than 4%,” underscoring just how wide the professional range has become, as summarized in the section that begins “4 Some experts have questioned this rule.”
Turning a rule of thumb into a personal plan
For individual retirees, the practical takeaway is that the 4% rule is no longer a one size fits all prescription, if it ever was. Bengen’s own evolution, from the original 4.17% to a more confident 4.7%, shows how new data and better modeling can change what “safe” looks like, especially for diversified portfolios that include a healthy mix of stocks and bonds. One recent profile of his work notes that with his new book and updated simulations, he now believes the maximum safe withdrawal rate is higher than 4% today, and that retirees should think in terms of a personal maximum safe withdrawal rate that reflects their time horizon and willingness to adjust spending, a concept also highlighted in a guide on what the founder of the 4% rule wants people to know now, which explains that his research has led him to refine his advice based on each retiree’s time horizon and legacy goals, as described in the section titled What the Founder of the 4% Rule Wants You to Know Now.
At the same time, Bengen is not alone in suggesting that some retirees can safely spend more if they are thoughtful about risk. A recent feature on how the creator of the 4% rule shares his new strategy to retire richer explains why he believes you can safely spend more than 4% in certain environments, especially when valuations are not at extremes and when retirees are prepared to accept a slightly higher risk of adjustment, a case laid out in the section “Why You Can Safely Spend More” within the piece titled Creator of the 4% Rule Shares His New Strategy To Retire Richer. Another explainer on the original 4% framework, “The 4% Rule: Clearing Up Misconceptions With Its Creator Bill Bengen,” reinforces that the rule was always meant as a planning tool rather than a rigid cap, and that understanding the assumptions behind it, including tax treatment and portfolio mix, is essential before deciding whether to push toward the higher end of the new range, a point that comes through clearly in the conversation with Nov Financial Samurai.
More From TheDailyOverview
Nathaniel Cross focuses on retirement planning, employer benefits, and long-term income security. His writing covers pensions, social programs, investment vehicles, and strategies designed to protect financial independence later in life. At The Daily Overview, Nathaniel provides practical insight to help readers plan with confidence and foresight.
