Safe withdrawal rate calculator
How often does a withdrawal rate last? Test the 4% rule, or any rate, against 1,000 simulated markets.
Your numbers
Then the same amount, raised with inflation.
The rest in bonds.
Result
75%chance of successWorth a closer look
In 752 of 1,000 simulated markets, your money lasts the whole plan.
$40,000 in the first year, raised with inflation, lasts 30 years in 75% of simulated markets.
- Left after 30 years (median)
- $352,562
- 1 market in 10 runs out by
- Year 25
| Year | Expected | 10th pct | Median | 90th pct |
|---|---|---|---|---|
| 1 | $1,014,880 | $888,918 | $1,007,436 | $1,151,387 |
| 4 | $982,646 | $733,383 | $968,169 | $1,273,084 |
| 7 | $947,399 | $621,225 | $914,368 | $1,355,675 |
| 10 | $908,855 | $519,191 | $872,732 | $1,403,000 |
| 13 | $866,708 | $431,396 | $806,079 | $1,434,859 |
| 16 | $820,619 | $333,638 | $748,049 | $1,522,919 |
| 19 | $770,222 | $225,835 | $675,204 | $1,555,599 |
| 22 | $715,112 | $111,583 | $604,973 | $1,586,024 |
| 25 | $654,848 | $535 | $516,370 | $1,607,267 |
| 28 | $588,951 | $0 | $426,174 | $1,608,669 |
| 30 | $541,630 | $0 | $352,562 | $1,656,091 |
| Withdrawal rate | First year | Lasts |
|---|---|---|
| 3.0% | $30,000 | 95% |
| 3.5% | $35,000 | 88% |
| 4.0% | $40,000 | 75% |
| 4.5% | $45,000 | 59% |
| 5.0% | $50,000 | 44% |
| 5.5% | $55,000 | 30% |
| 6.0% | $60,000 | 20% |
RetirementPace is an educational tool, not financial, tax or legal advice. RetirementPace is not a registered investment adviser.
Track whether you stay on pace
A calculator answers today. Pace is whether you’re still on track next month and next year. Save this as a plan in the free planner (it stays in your browser), and soon record your real balances each month to see if you’re ahead or behind.
How it works
Each simulated market draws a return for stocks, bonds and cash for every year, from long-run averages and volatility (7% and 16% for stocks, 4% and 6% for bonds), correlated with each other. The portfolio pays the first year’s withdrawal, then the same amount raised by 2.5% inflation each year, and is rebalanced to your mix. Fees of 0.2% a year come off the return.
A market succeeds if the money lasts every year. The success rate is the share of 1,000 markets that do. The same markets are used for every rate in the table, so the rates compare like for like.
Worked example
A $1,000,000 portfolio, 60% in stocks, paying $40,000 in its first year (4%) and that amount plus inflation after: it lasts 30 years in 75% of simulated markets, and the median market leaves $352,562 in today’s dollars at the end.
Questions
What is the 4% rule?
Withdraw 4% of your portfolio in the first year of retirement, then the same amount adjusted for inflation every year after, whatever the markets do. William Bengen’s 1994 study of US market history found that a mix of stocks and bonds survived every 30-year period he tested at that rate.
Why is the success rate here not 100% at 4%?
These are simulated markets drawn from long-run averages and volatility, not replays of US history, so they include bad sequences that history may not contain. The returns are also set by RetirementPace’s own assumptions, which you can read in the methodology. A rate that worked in every past period can still fail in some simulated ones.
Does this include taxes?
No. The withdrawal is the amount taken out of the portfolio before any income tax, as in the original studies. Money in a traditional IRA or 401(k) will be taxed as you withdraw it, so the spending it supports is lower. The retirement calculator and the planner include taxes.
Where does Social Security fit in?
Leave it out here. Use the withdrawal your savings have to cover after Social Security and any pension: if you spend $60,000 a year and Social Security pays $24,000, test a withdrawal of $36,000.
How much does the stock share matter?
A lot, in both directions. More stocks raise the expected return and the range of outcomes; too few and inflation-adjusted withdrawals outrun the growth. Try the same rate at 30%, 60% and 90% stocks to see the trade-off under these assumptions.