Part 6/9:
The solution lies in investing. For example, if you invested $500 monthly with an annual yield of 10%, your savings would compound significantly over time. In contrast, merely saving in cash could mean losing a substantial portion of your wealth to inflation.
To retire comfortably, one must aim for investment returns that exceed the rate of inflation continually. This understanding leads us to the famed 4% rule, which states that retirees can sustainably withdraw 4% of their retirement savings annually without exhausting their funds.