Safe Withdrawal Rate Calculator
Calculate your safe withdrawal rate for retirement. This tool compares different withdrawal rates (3%, 4%, 5%) with their success probabilities, shows how long your portfolio will last, and helps you determine the right balance between income and security.
Your Retirement Situation
Other Income Sources (Monthly)
Your Withdrawal Rate
Safe
You need $40,000/year from your portfolio
Withdrawal Rate Comparison
| Rate | Annual | Monthly Total | Success Rate* | Lasts |
|---|---|---|---|---|
| 3% Very Conservative | $30,000 | $2,500 | 99% | Indefinite years |
| 3.5% Conservative | $35,000 | $2,917 | 97% | Indefinite years |
| 4% Traditional (4% Rule) | $40,000 | $3,333 | 95% | 93 years |
| 4.5% Moderate | $45,000 | $3,750 | 88% | 53 years |
| 5% Aggressive | $50,000 | $4,167 | 78% | 40 years |
Portfolio Required for Each Rate
| Withdrawal Rate | Portfolio Needed | Your Surplus/Shortfall |
|---|---|---|
| 3% (Very Conservative) | $1,333,333 | -$333,333 |
| 3.5% (Conservative) | $1,142,857 | -$142,857 |
| 4% (Traditional (4% Rule)) | $1,000,000 | +$0 |
| 4.5% (Moderate) | $888,889 | +$111,111 |
| 5% (Aggressive) | $800,000 | +$200,000 |
Portfolio Projection (30 Years)
Understanding Safe Withdrawal Rates
The 4% Rule
Based on the Trinity Study, the 4% rule suggests withdrawing 4% of your portfolio in year one, then adjusting for inflation each year. This has historically sustained portfolios for 30 years with ~95% success rate.
Factors That Affect Success
Key factors: retirement length, asset allocation, sequence of returns risk, flexibility to reduce spending, and other income sources. Longer retirements may warrant lower withdrawal rates.
Dynamic Withdrawal Strategies
Consider flexible strategies: reduce withdrawals in down markets, use guardrails (increase/decrease based on portfolio performance), or the "bucket" strategy with different time horizons.
Frequently Asked Questions
What is a safe withdrawal rate?
A safe withdrawal rate (SWR) is the percentage of your retirement portfolio you can withdraw annually with a high probability of not running out of money. The most famous is the 4% rule, which suggests withdrawing 4% in year one and adjusting for inflation each year thereafter.
Is the 4% rule still valid?
The 4% rule remains a useful starting point, but many experts now suggest 3.5% for longer retirements or more conservative planning. Factors that should influence your personal withdrawal rate include:
- Current market valuations
- Expected future returns
- Your retirement length (early retirees need lower rates)
- Flexibility to reduce spending if needed
- Other income sources (Social Security, pension)
How much do I need to retire with the 4% rule?
Multiply your annual expenses by 25. For example:
- $40,000/year expenses → $1,000,000 needed
- $60,000/year expenses → $1,500,000 needed
- $80,000/year expenses → $2,000,000 needed
- $100,000/year expenses → $2,500,000 needed
What withdrawal rate is safest?
A 3% withdrawal rate has historically had near-100% success rates over 30-year periods. For early retirees with 40+ year horizons, 3-3.5% is often recommended. The trade-off is lower annual income in exchange for greater security.