Most people overestimate how much they can withdraw each year.

A new survey from New York Life shows that retirees and pre-retirees are more savvy about spending down their savings than they were a decade ago, with more than twice as many today saying that annual withdrawals should be held to less than 5% of one’s nest egg to avoid prematurely depleting it...

But despite the improvement, far too many people still don’t have a clue about the right way to draw down their savings.

When New York Life asked retirees and pre-retirees in their 40s or older back in 2006 how much they could withdraw from their nest egg each year if they wanted it to last a lifetime, only 10% correctly answered that they should limit their withdrawal rate to less than 5%...