FIRE
Capital preservation is a withdrawal strategy in which only the returns are withdrawn, so that the initial portfolio value is maintained permanently.
Capital preservation is a withdrawal strategy in which only the ongoing returns are taken out, while the capital originally invested is left untouched. The aim is to keep the underlying portfolio intact over the long term.
Unlike capital drawdown (Kapitalverzehr), where the portfolio is deliberately used up over time, capital preservation seeks to keep the substance in place, for instance to pass it on later or to hold it as a reserve.
How much can be withdrawn this way generally depends on the returns actually earned and can vary from year to year. The strategy is therefore guided more by income than by a fixed withdrawal amount.
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