FTA, the value of the average retiree's estate is ~300k in the 60s, 70s, and 80s. Using the 4% rule (make your money last 30 years), that's 12,000 a year, and that's probably skewed upward by the compounding of the super wealthy (20 richest people worth more than bottom 50%, 150 million people). The median is probably much, much lower (I'd wager 50k). That's living off of cat food in both cases, and if you're worried about social security or your pension... Did I miss something?
Spending down your principal may not be a smart idea though, especially if one is in good health. It runs the risk of them outliving their savings. Spending 4% or less of your assets annually is sustainable indefinitely, statistically speaking.
That's optimal from an individual perspective, but not necessarily from a societal perspective. The author suggests it might be better if people had insurance which paid an annuity after reaching a certain age (say 80) and then people could plan to have their savings run out at 80 instead of everyone having to plan to live until 100 with only a tiny fraction making it to that age.
Just read more about the article. The estate value is everything, not just liquid assets. The median liquid assets were around 10k, median estate is around 50k.
