I've been thinking about what retirement looks like, and I'm trying to figure something out. Let's say I have a sum invested ($Y) in an index fund that grew by 60k in 12 months, for a total value of $X. If I sell shares to a value of 60k, bringing my balance back to $Y, and the growth rate remains the same for the next year, am I correct in assuming that 12 months later the account will once again be worth $X?
Would I be able to sustain a personal income of 60k a year like that indefinitely, given a constant growth rate? Like, would I eventually run out of shares to sell, or would each share be increasing in value each year enough for those transactions to remain viable?
This seems like a dumb question, since the math seems to side with me on a basic level; eg, Y +60k = X, X-60k = Y, Y +60k = X, and so on forever. However, my experience with investment is nonexistent, so I'm having trouble understanding if there being a specific number of shares representing my balance would change this situation.
This hypothetical is purposefully ignoring the fact that index funds don't normally have a fixed constant growth rate to address the question of whether I'd run out of money by always selling equal or less than the amount by which the account grew each year.