>>Why assume a “withdrawal rate?” What about investing the $2 million in a diversified portfolio that earns, say, 4% annually? Won’t that give you $80,000 without withdrawing any principle at all?<<
That is the theory but planning is to draw it down and assume no return. For TSA-type investments you have to take withdrawals anyway.
And yes, that is my plan, too. However, I'm also factoring in some market return to be included, and not just assume a drawdown without additional investment earnings.
Also, there is the benefit of not paying $10,000 into Social Security and Medicare taxes anymore.
-PJ