How much can one spend without risking insolvency? That is an important question, but the so-called “4 percent rule” has been dissected so many times and from so many angles, planners can be forgiven if they are sick of safe withdrawal rate research.

Despite being a bit of a research junkie, I also can’t say I get particularly enthusiastic with each new paper either.

One of the more substantial hang-ups that I have with withdrawal rate research centers around the spending assumption. I have been advising retirees for over a quarter-century, and I have yet to find a single household that actually spends money the way typical withdrawal rate research assumes. Studies assume a specific amount is spent in year one of retirement and that amount is increased in lockstep with inflation each and every year.

I recognize that many retired Americans that live solely on Social Security and/or some pensions spend in a similar pattern to that used in these studies, but that is a circumstance in which they have no choice because they have no assets to generate additional income.

My clients have some assets to supplement these sources and none of them spend using such a pattern.

Because of this disconnect from the spending pattern illustrated and what families really do, I find much of the research almost useless. I find myself wanting to see more research that could enlighten as to whether what I observe anecdotally among my clients is common or anomalous.

Most of my clients have the assets that they do because they learned to live within their means and spend less than they made. This discipline seems to have carried over into their retirement in that they usually start spending an amount they know will cover their typical ongoing expenses and provide some degree of cushion.

What I see most often is that clients do not increase their regular withdrawals for several years after they retire. As their expenses increase with inflation, the cushion shrinks, but it takes a few years for that cushion to shrink so much that clients want an increase.

I would love to see substantive research on this but for now, you will have to settle for my theories as to what contributes to this phenomenon.

I like to think that because we spend time educating clients and discussing the interplay between their spending levels and the behavior of their portfolio, clients better understand the consequences of their spending choices. Many clients have indicated that is the case.