Savings

[pachipres]

Hi There,
My husband and I are getting ready to retire soon. He is working 60 hours a month at a contract that will be ending soon.  We have  1.275 million and I have a question.  I am not sure whether to build up a savings account (can likely add 3k to this each month until the contract ends) making less than 1 % or do I put it in the retirement portfolio of 1.275 million.  In other words, should I have a savings account to dip into or just to withdraw from monthly until all this money is gone and then start our 3% withdrawal rate.

Hope I am making sense here.

Thank you very much.

Lorna

[BarkyardBQ]

Typically any money you will need in the short term (12 months) should be in savings and not where it's more volatile.

However with a 3% WR, I don't think it really matters. http://www.madfientist.com/safe-withdrawal-rate/

Personally, I plan to have the first year of retirement expenses in cash, saved during the few months before we quit.

[pachipres]

Thanks BackyarBQ for responding. Well, it will start at 3% but might have to go up to 4%. Thanks for letting me know you plan on keeping 12 months worth of expenses in savings. It is good to hear what others are doing.

Lorna