It's also important that what you withdraw from the fund is less than what the fund is actually earning. This way, the fund will continue to grow, assuring you that you will never run out of money and that you will be able to increase your income over time to keep pace with inflation. That way, the fund will continue to grow over time. That's why I like to use balanced funds for SWPs, although you can also do it with other kinds of funds. I choose balanced funds because they are highly diversified, with stocks, bonds, government securities, cash, and sometimes even international securities.
Balanced funds strike a nice, well, balance to the whole idea.
You could, however, use several funds of different kinds. By mixing them together, you create your own balanced portfolio. This is how you're likely to do it if your money is held in a brokerage account. Then, you begin to siphon money monthly from the next investment, and complete this process for the rest of your life. Exactly how to choose the right funds and income stream for you, as well as working directly with funds or via a brokerage account, is best determined by a number of factors, including your age and life expectancy, income needs, risk tolerance, and estate planning considerations.