Retirement Drawdown Calculator
How long will your money last in retirement?
Your Situation
Assumptions
Spending Scenarios
| Monthly | Rate | Lasts |
|---|---|---|
| $1,750 | 2.1% | ∞ |
| $2,625 | 3.1% | 90.1 yrs |
| $3,500 | 4.2% | 41.2 yrs |
| $4,375 | 5.3% | 28.2 yrs |
| $5,250 | 6.3% | 21.6 yrs |
Year-by-Year Projection
| Year | Start Balance | Withdrawal | Growth | End Balance |
|---|---|---|---|---|
| 1 | $1,000,000 | -$42,000 | +$27,903 | $985,903 |
| 2 | $985,903 | -$42,000 | +$27,492 | $971,395 |
| 3 | $971,395 | -$42,000 | +$27,070 | $956,465 |
| 4 | $956,465 | -$42,000 | +$26,635 | $941,100 |
| 5 | $941,100 | -$42,000 | +$26,187 | $925,287 |
| 6 | $925,287 | -$42,000 | +$25,727 | $909,014 |
| 7 | $909,014 | -$42,000 | +$25,253 | $892,267 |
| 8 | $892,267 | -$42,000 | +$24,765 | $875,032 |
| 9 | $875,032 | -$42,000 | +$24,263 | $857,295 |
| 10 | $857,295 | -$42,000 | +$23,746 | $839,042 |
Methodology
Uses the annuity depletion formula with real returns (Fisher equation). Year-by-year simulation withdraws at start of year, then applies real return to remaining balance. This is a deterministic model — actual outcomes depend on sequence of returns risk, which can significantly impact results. Consider this a planning estimate, not a guarantee.
Frequently Asked Questions
What is a safe withdrawal rate?
The most commonly cited safe withdrawal rate is 4% (Trinity Study, 1998). This means withdrawing 4% of your initial portfolio in year 1, then adjusting for inflation. Historically, this sustained a 60/40 portfolio for 30+ years ~95% of the time.
What happens if I withdraw too much?
If your withdrawal rate exceeds your real return, your portfolio depletes over time. The higher the rate, the faster it depletes. Above ~5-6%, depletion risk increases significantly over 30-year horizons.
Should I adjust withdrawals over time?
Yes — flexible withdrawal strategies (spending less in down years) significantly improve portfolio longevity. The 'guardrails' approach suggests reducing spending by 10% when your portfolio drops below thresholds.
How does inflation affect my retirement?
Inflation erodes purchasing power silently. At 3% inflation, your living costs double every 24 years. A $3,500/month lifestyle today costs ~$7,000/month in 24 years. This calculator accounts for inflation by using real returns.
What about sequence of returns risk?
Bad returns early in retirement are far more damaging than later. This calculator uses constant returns — in reality, a 30% drop in year 1 would dramatically reduce longevity compared to the same drop in year 20.
What portfolio allocation should I use?
A common retirement allocation is 60% stocks / 40% bonds, which has historically returned 5-7% nominally. Some retirees use a 'bucket strategy' with 1-2 years of cash, bonds for 3-10 years, and stocks for 10+ years.