Mike MilliganFounder and CEO, 1.oak Financial · Founder and CEO, 1.oak Financial

The Evolution of the 4% Rule | Conversation with William P. Bengen

3 Oct 2025 · 1 min

Watch on YouTube

0:57

In this interview segment, host Mike Milligan asks William P. Bengen about his current recommended asset allocation for retirees and any lesser‑known investments. Bengen explains that his research‑based baseline portfolio consists of roughly 55% equities, 40% bonds, and 5% cash. He notes that emerging evidence suggests many retirees could safely increase the equity portion to 70‑75% or even higher, because stocks historically deliver higher returns than bonds and bonds are primarily needed to buffer occasional market downturns. The discussion highlights Bengen’s openness to revisiting the classic 4% rule allocation in light of newer data.

Chapters

You're a huge advocate for diversification these days, way beyond the old just stocks and bonds. If someone wants to get the most out of their retirement, what's your go-to asset allocation now? And are there some lesser-known investments you think retirees should be including?
Well, that's a tough one. I think, you know, I work with a, in my, most of my research, a 55% stock, 40% bond, 5% cash routine. And I'm looking at from a research angle whether that should be higher than that. There are some indications that in many cases people could take, have a 70% or 75%, even a higher allocation to stocks during all of retirement and do well because stocks return much higher than bonds. The time you need bond is when the stock market is not doing well, and that happens, but not that often.