@cstone @debrazebra, One thing I'm confused about is what is the purpose/use of the withdrawal rate. The answer of what formula is best depends entirely on the context of how the answer will be used.
My primary purpose for tracking the wd rate is thinking about how quickly I am "drawing down" the portfolio. That's why for me, after all inflows from outside the system have been accounted for, I'm interested in how much comes out of the whole in relation to how much I started with.
At other times I'm interested in other notions of withdrawal: e.g. the yearly result of a particular withdrawal method /total portfolio.
Debra (and others) what is your purposes/uses for knowing the "withdrawal rate" of your portfolio? What prompted your original request?
For me it is very very simple. Having decided how much I need/want to withdraw from my portfolio, I would like to know what percentage that amount is of my total portfolio, year by year. It is interesting to see how a successful Pralana plan withdrawal rate stacks up against the oft-recommended 4%, and also how those number would change if I changed other things, like projected rates of return, expenses, or whatever.
For all the discussion this has generated, if this were an Excel spreadsheet I would have dropped in a column for what I want and called it a day. To be fair, I never thought about 529's, payroll taxes, or the other things mentioned above by @cstone. Please please please, just a simple column, at least for me.
