🧭 When and how do you start withdrawing from a Permanent Portfolio? 💰

[frugal]

Hi everyone!

I’ve been diving into the Permanent Portfolio strategy — the classic allocation of 25% stocks, 25% bonds, 25% gold, and 25% cash — and I really appreciate its simplicity, resilience, and balance across market conditions.

That said, most of the information I find focuses on the accumulation phase. I’d love to hear thoughts from those who are already retired, semi-retired, or just planning for the withdrawal phase. Specifically:

When do you start withdrawing?
• Is it mostly age-based (e.g., at 60 or 65)?
• Or do you wait until the portfolio hits a certain value (e.g., 25x or 33x your annual expenses)?
• Anyone doing barista FIRE or early retirement with it?

How do you withdraw?
• Do you take money proportionally from all four assets?
• Or withdraw from the most overperforming asset and rebalance at the same time?
• Do you follow a fixed percentage (like 4% rule), or adjust withdrawals based on performance?
• How do gold and cash behave in practice during decumulation?

Other doubts I have:
• What kind of rebalancing schedule works best during retirement?
• Does anyone use buckets or laddering strategies inside the Permanent Portfolio framework?
• Any good tools, spreadsheets or simulators that work for this kind of setup?

I know this strategy is more conservative than most, but for those of us who like peace of mind over chasing high returns, it seems like a great long-term fit.

Would love to hear from anyone who has experience, theory, or even just ideas on how to make the most of the Permanent Portfolio in retirement. All input is welcome!

Thanks in advance!

[mathjak107]

it’s no different than any other portfolio .

we have been using bob clyatts 95/5 method of withdrawal for a decade now .

we look at the balance each dec 31 .

we get to set as spending goal posts the higher of 4% of the balance or in a down year , 4% of the balance or 5% less then we were taking . which ever is higher is what you take

that’s it , done .

so if you have 100k portfolio than you will keep 96k invested .


it’s a nice easy system and no inflation adjustment is needed as it self adjusts .

divide 96k by 4 and that is the level you should end up with left in each investment


next year you have 105k as a balance .

so its 4% of 105k or 4200 and the remaining assets are adjusted to the balance .

firecalc actually has a withdrawal method tab for 95/5


buckets are no different but they allow your allocation to change . the reason is that there are no rules as to when you refill bucket one that you are spending from .

so if you wait longer to refill bucket one your allocation to equities is growing higher and higher .

in a worst case example one can let bucket one drain , refill from bucket two and end up with almost 100% equities as an allocation before finally refilling buckets one and two . you can be 85 and be 100% equities if you delay refilling long enough

the cash bucket in the pp serves the function of being the other end of the barbel, for the long term treasuries .

if you spend that down and don’t instantly refill and rebalance you lopsided the barbel so at the end of the day it’s really the same whether you use buckets or not.


the simpler the method the better and we find 95/5 works incredibly well plus it’s dynamic so it reflects exactly where your balance stands

as far as when to draw . that’s up to you .

i had to draw from the day i quit getting a pay check , maybe even a bit before since i went to 4 days before actually retiring.

so i retired at 62 , took ss at 65 since i still to this day work one day a week doing training for my old company and love it . but even the one day gave me to much to collect ss until the year i was going to be full retirement age .

this week is actually ten years since i stopped working the 4 days and got a meaningful paycheck.

so after pulling out 6 figures a year from our accounts we are way higher in balance today then we were the day we retired a decade ago .


markets have been great for us and our investments kept us well ahead and growing .


we hit a new all time record yesterday as far as our invested assets go.

what’s nice is that at this point our portfolio is up so much that we can actually draw 100k a year more than we do because we have ten years of life left then we did . the planning is for a lot less years now than the 30 years we started at .

so while we set these goal posts we are under so every couple of years we will just spend big .

we bought a 80k car in 2023 , last year my wife and i dropped 40k on new cameras and lenses since we both are avid photographers.

so we always find ways to enjoy the money now . but i can tell you this .

it was the strong compounding we saw and the pedal to the metal investing we did that left us in this shape prior to retirement.

both of us were never high earners so strong compounding was so important to us

[frugal]