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If an individual wishes to have a fixed portion of the portfolio liquidated each month, then the type of withdrawal plan which he or she should elect is fixed percentage.

What is withdrawal plan?

A withdrawal plan is a financial plan that allows a shareholder to withdraw money from a mutual fund or other investment account at predetermined intervals. Frequently, this type of plan is used to fund expenses during retirement.

What is fixed percentage withdrawal?

Fixed percentage withdrawals refer to withdrawing a fixed percentage of your account balance every year. For example, taking out 4% or 5% of your total invested funds every single year. With this approach, the amount you withdraw will vary as your investment account balance increases and falls.

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