Sure, everyone can use their nest egg to their best advantage, but strictly speaking, the 4% figure is derived from the premise of making a nest egg last 30 years over any market return. As I posted earlier, the "net net" is that one has to achieve returns that beat inflation by 1.5% to make a nest egg last 30 years if withdrawing 4%, inflation adjusted.That’s true if your goal is to retain a particular nest egg through your lifespan. The approach I’ve used for planning purposes is to map out my cash flow sources over the projected years, accounting conservatively for expected growth and inflation, and evaluate my options. I haven’t completely retired yet, but could do so and draw down one retirement account until one pension kicks in. This gives me a basis to compare the various possibilities and choose one, then adjust for realized rather than anticipated changes.
I have no pension, just a 401K. So my plan is to save enough outside my 401K to either 1) delay 401K withdrawal, 2) be able to skip withdrawal on years with low return or 3) live it up for 30 years, supplementing my withdrawal with my savings, and then lean on my kids when I go broke .