Safe Withdrawal Rate Calculator
The 4% Rule & Trinity Study visualized
How much can you safely withdraw from your retirement portfolio each year without running out of money? Our calculator uses the famous Trinity Study data, Monte Carlo simulations, and historical market returns to help you find a sustainable withdrawal rate for your retirement timeline.
Open Source & Transparent
All calculations are open source and verifiable on GitHub. We believe in transparency and welcome contributions to improve our tools.
Based on 30-year retirement with 60/40 stocks/bonds
Historical Success Rate
99%
Withdrawal Rate
4.0%
Annual Withdrawal
$40,000
Monthly Income
$3,333
Your Retirement Plan
Quick Summary
Success Rate by Withdrawal Rate
Historical success rates for 30-year retirements with 60/40 allocation
Annual Withdrawal Comparison
| Rate | Annual | Monthly | Success |
|---|---|---|---|
| 3% | $30,000 | $2,500 | 100% |
| 3.5% | $35,000 | $2,917 | 100% |
| 4% | $40,000 | $3,333 | 95% |
| 4.5% | $45,000 | $3,750 | 89% |
| 5% | $50,000 | $4,167 | 78% |
| 5.5% | $55,000 | $4,583 | 78% |
| 6% | $60,000 | $5,000 | 78% |
Insights & Recommendations
- Consider a variable withdrawal strategy like guardrails. Flexibility in down years can dramatically improve success rates.
- If you expect Social Security or pension income, include it in your analysis. Supplemental income can significantly reduce portfolio withdrawal needs.
- Keep 1-2 years of expenses in cash/short-term bonds to avoid selling stocks during downturns.
- Consider flexible spending - reduce withdrawals by 10-20% in down years to dramatically improve success rates.
Understanding Safe Withdrawal Rates
A safe withdrawal rate (SWR) is the percentage of your retirement portfolio you can withdraw each year while maintaining a high probability that your money lasts throughout retirement. The most famous SWR guideline is the "4% rule," which emerged from the landmark Trinity Study.
Our calculator goes beyond simple rules of thumb by running thousands of Monte Carlo simulations based on historical market returns, analyzing sequence of returns risk, and comparing different withdrawal strategies to help you make informed decisions about your retirement income.
The 4% Rule Explained
The 4% rule is a widely-used retirement guideline that suggests:
4%
Initial Withdrawal
Withdraw 4% of your portfolio in year one of retirement.
+Inflation
Annual Adjustment
Increase withdrawals by inflation each year to maintain purchasing power.
Example: With a $1,000,000 portfolio, withdraw $40,000 in year one. If inflation is 3%, withdraw $41,200 in year two, and so on.
Note: The 4% rule was designed for 30-year retirements. Early retirees (FIRE) may need lower rates (3-3.5%) for longer time horizons.
The Trinity Study
The Trinity Study (1998) analyzed historical U.S. market data to determine portfolio success rates for various withdrawal rates and asset allocations over 15-30 year periods. Key findings at 4% withdrawal rate:
| Stock/Bond Allocation | 15 Years | 20 Years | 25 Years | 30 Years |
|---|---|---|---|---|
| 100% Stocks | 100% | 100% | 100% | 95% |
| 75% Stocks / 25% Bonds | 100% | 100% | 100% | 98% |
| 50% Stocks / 50% Bonds | 100% | 100% | 95% | 90% |
| 25% Stocks / 75% Bonds | 100% | 95% | 85% | 75% |
| 100% Bonds | 88% | 70% | 55% | 35% |
Source: "Retirement Savings: Choosing a Withdrawal Rate That Is Sustainable" by Cooley, Hubbard, and Walz (1998), updated with modern data.
Sequence of Returns Risk
Sequence of returns risk is the danger that poor market returns early in retirement can devastate your portfolio's longevity, even if average returns over the full period are good. This is the #1 risk for retirees.
⚠️ Early Bear Market
A 30% market drop in years 1-5 can reduce portfolio longevity by 10+ years, even if markets recover fully afterward.
✓ Late Bear Market
The same 30% drop in years 25-30 has minimal impact because most withdrawals have already been made.
Mitigation Strategies:
- Keep 1-2 years of expenses in cash or bonds
- Use a flexible withdrawal strategy (reduce spending in down years)
- Consider a "bond tent" (higher bond allocation at retirement, gradually shifting to stocks)
- Start with a lower withdrawal rate (3.5%) and increase if markets are strong
Withdrawal Strategy Comparison
Fixed Dollar (4% Rule)
Withdraw a fixed dollar amount (adjusted for inflation) regardless of market performance. Simple and predictable, but can deplete portfolio in severe downturns.
Percent of Portfolio
Withdraw a fixed percentage of the current portfolio value each year. Never depletes portfolio, but income varies significantly with market performance.
Guardrails Strategy
Start with a base rate, but adjust if portfolio grows or shrinks beyond thresholds. Balances income stability with portfolio preservation.
Variable Percentage Withdrawal (VPW)
Withdrawal rate increases as you age (based on remaining life expectancy). Maximizes lifetime spending while ensuring you never run out.
Considerations for Early Retirement (FIRE)
3-3.5%
Recommended SWR
For 40-50+ year retirement horizons, a lower rate provides more safety
25-33x
FIRE Number Multiple
Save 25x (4% rule) to 33x (3% rule) your annual expenses
Flexibility
Key Advantage
Early retirees can adjust spending or return to work if needed
Important Caveats
- Historical data ≠ future results. Past market returns don't guarantee future performance. Consider using a more conservative rate as a safety margin.
- Taxes matter. Our projections are pre-tax. Factor in your tax situation when planning actual withdrawals.
- Healthcare costs. Pre-Medicare healthcare can be expensive. Budget separately if retiring before 65.
- Inflation varies. Historical average inflation (~3%) may not match future inflation. Build in flexibility for higher-than-expected inflation.
Related FIRE Tools
Explore other calculators to plan your financial independence journey