Part 3/6:
Maurie Backman points out that the primary factor undermining the reliability of the 4% Rule is the significant change in interest rates over the years. When the rule was established, interest rates were substantially higher, leading to more favorable yields on bonds, which constituted a significant portion of retirement portfolios at the time. Today, with lower interest rates, investors are likely to experience diminished income from bonds, thereby complicating the feasibility of withdrawing 4% annually.