Retirement withdrawal calculator
Enter a portfolio balance and a withdrawal rate to see the annual and monthly income it supports, and what the balance looks like after 30 years at a given return.
Planning estimate, not financial advice. Returns and withdrawal rates are assumptions.
How this calculator works
The withdrawal rate is the share of the portfolio you take out each year. The famous "4% rule" comes from the Trinity study: withdrawing 4% of the starting balance, adjusted for inflation, historically lasted at least 30 years in most US market periods. Lower rates are safer; 3–3.5% is common for retirements longer than 30 years or for conservative portfolios.
The calculator also grows the balance at an expected real (after-inflation) return and subtracts the withdrawal each year, so you can see whether the portfolio survives the period.
The formula
annual withdrawal = balance × withdrawal rate
monthly withdrawal = annual withdrawal ÷ 12
next-year balance = balance × (1 + real return) − annual withdrawalWith $1,000,000 at a 4% rate, the first year pays $40,000 — about $3,333 a month.
Worked example
A 1,000,000 portfolio at a 4% withdrawal rate pays $40,000.00 a year, or $3,333.33 a month. At a 4% real return over 30 years the balance would be $1,000,000.00.
Common mistakes
- Ignoring sequence-of-returns risk. A bad market in the first years of retirement hurts far more than the same decline later, because withdrawals lock in losses.
- Forgetting fees and taxes. Fund fees and income tax reduce the real return; a 4% withdrawal with 1.5% of costs is closer to 2.5% net.
- Assuming a constant return. Real markets are volatile; model a range of returns rather than one number.
Frequently asked questions
Is the 4% rule still safe?
It remains a useful planning anchor for a 30-year retirement, but many planners now suggest 3.5% or less for longer retirements or higher-cost portfolios.
Should I adjust withdrawals for inflation?
Yes — the classic rule increases the withdrawal each year with inflation. If markets fall sharply, cutting withdrawals temporarily helps the portfolio survive.
What return should I assume?
Use a real (after-inflation) return, typically 3–5% for a balanced portfolio. The calculator compounds whatever rate you enter.
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