I was recently in New York for meetings with portfolio managers, traders and analysts to discuss the world economy, stock markets and retirement income strategies. After a meeting at 11 Wall Street, home of the New York Stock Exchange, I had lunch with a few other advisors.

The topic that dominated our discussions was the question that advisors get asked most often by clients and one of the biggest concerns of people entering retirement: Will I run out of money?

We discussed and debated a number of retirement income strategies including, “The 4% Rule”. The 4% Rule dates back to a study that was published in 1994 by William Bengen and it concluded that a first-year withdrawal of 4% of your portfolio value, that is adjusted each subsequent year by the rate of inflation was sustainable for 30 years.

I personally like the strategy of a sustainable withdrawal rate and adjusting that rate as circumstances warrant. No one knows with certainty what future financial investment returns will be. The variables of returns, interest rates and inflation are out of our control. What we can control is our own behaviour. I often tell my clients that the behaviours that used to govern your money management while you worked, will be similar in retirement.

One of the keys to success while you were working was to be smart with your money: plan for vacations, save for a rainy day, invest for the long term. The same is true in retirement: stick to your investment strategy and your retirement income plan; remain vigilant of your withdrawals in down markets; be disciplined in your spending when needed.

I would never recommend that anyone blindly follow a withdrawal rule. Start withdrawal amounts at 4% of the portfolio value and monitor the rate in down markets. I encourage clients to consider putting a ceiling on withdrawal rates in bad markets; a ceiling of 6% for example, may help to further protect and preserve their nest egg. It’s time to review and consider cutting back when the rate exceeds 6%. Another safeguard is to put off big discretionary expenditures until good markets return.

My trip to New York was both productive and educational. As I reflect on what was debated and discussed, I’m more confident than ever that a sustainable income in retirement is a realistic goal. With an effective strategy, it is an achievable goal. From experience I’ve learned that you can’t let current events or today’s headlines cause you to lose focus. Always set goals, develop a plan, use a proven strategy, and keep your eye on the prize.

This article appeared in The Hamilton Spectator, Summer 2015.