The FIRE Wedge Strategy That Fixes Sequence Risk

Episode 38 of The FIRE Podcast with Fexingo tackles the withdrawal wedge — a concrete strategy that adjusts your spending based on portfolio performance in the first decade of early retirement. Lucas and Luna walk through the math: a retiree with a $1 million portfolio can spend $40,000 in a good year but only $34,000 after a 15% market drop, using a 0.7 spending beta. They compare this to the constant 4% rule, showing how the wedge cuts failure rates from 15% to under 5% in historical simulations. The episode also covers implementation details: which accounts to draw from first, how to automate the cutback, and why a 60% stock / 40% bond portfolio still works. A practical episode for anyone worried about sequence-of-returns risk derailing their FIRE plan. #FIRE #FinancialIndependence #EarlyRetirement #SequenceOfReturnsRisk #WithdrawalWedge #PortfolioManagement #RetirementSpending #The4PercentRule #SafeWithdrawalRate #SpendingBeta #RetirementPlanning #PersonalFinance #Investing #FexingoBusiness #BusinessPodcast #FIREPodcast #FrugalLiving #FinancialPlanning Keep every episode free: buymeacoffee.com/fexingo