The 4% rule is now the 4.7% rule. That matters for your retirement.

Three decades ago, financial adviser Bill Bengen created a retirement principle called the 4% rule. It went viral.

Now, the rule is getting an update.

The 4% rule says you should plan to spend 4% of your savings in the first year of retirement, and spend the same amount, adjusted for inflation, every year after that.

It caught on because it’s a simple formula to solve a complex problem: how to fund your retirement.

The 4% rule has drawn praise and pillory for years. Now, Bengen says it’s time for a revision: The 4% rule has become the 4.7% rule.