Safe Withdrawal Rate Calculator
Find out how long your portfolio will last at your planned withdrawal rate — and whether it's sustainable.
| Year | Portfolio Balance | Annual Withdrawal (inflation-adj.) |
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| Rate | Monthly Income | Years to Depletion | Rating |
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The Origin of the 4% Rule (Trinity Study, 1998)
In 1998, three professors at Trinity University published a study analyzing historical portfolio performance over 30-year periods from 1926 to 1995. They found that a 4% initial withdrawal rate, adjusted for inflation annually, succeeded in nearly all historical 30-year periods when the portfolio was 50–75% in equities. This became known as "the 4% rule" — not a guarantee, but a historically grounded starting point.
Sequence of Returns Risk
The biggest threat to a retirement portfolio isn't average returns — it's the order of returns. A major market crash in the first few years of retirement forces you to sell shares at low prices to fund withdrawals, permanently reducing the portfolio's ability to recover. A 30% decline in year one is far more damaging than the same decline in year 20. This is why many advisors suggest a cash buffer or flexible withdrawal strategy.
Adjustable Withdrawal Strategies
A rigid 4% rule ignores market conditions. Flexible strategies — like reducing withdrawals by 10% in down years, or using the "guardrails" approach — have been shown to improve portfolio longevity. If your portfolio drops 20%, temporarily reducing spending by $200/month on discretionary items can preserve years of retirement income.
CAPE-Based Withdrawal Rates
Some researchers, including Wade Pfau, suggest that when stock valuations are high (measured by the Shiller CAPE ratio), future returns are likely to be lower — meaning a 4% rate carries more risk than historical data suggests. A more conservative 3–3.5% rate when CAPE is elevated provides a larger margin of safety.