frufrau,
There are quite a few municipal bond funds out there that pay 5-6% tax free right now. [I like, own, and recommend NIO.] You could buy a basket, live off (less than) 4% since you won't be paying much, if anything, in taxes; and reinvest the surplus to stay ahead of inflation. Most of these funds have the bonus of paying a stable and monthly distribution. Budgeting is easy-peasy.
I wouldn't recommend a 100% bond allocation. You could maybe do a split between munis and VOO (s&p 500 index), which currently pays almost 2%. You would be able to make it a year that way without withdrawing any principal from VOO, keeping it tax efficient.