Calculator · Retirement

Retirement withdrawal calculator

Enter your starting balance, the first year's withdrawal, an annual return and an inflation rate. The retirement withdrawal calculator builds the schedule year by year and reports the year the money runs out, or what is left at the end.

Your numbers

Dollars, or a rate such as 4 if you chose percent.
After fees. Hypothetical, applied every year.

Ending balance

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Money runs out

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Ending, today's dollars

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Total withdrawn

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The working

    How the years are built

    Each year the withdrawal comes out first, at the start of the year, and the rest earns the return. The first withdrawal is the figure you enter. After that it rises with inflation so the spending keeps its buying power. With $800,000, a $32,000 first withdrawal (4%), a 5% return and 3% inflation, year one leaves $768,000 invested, which grows to $806,400. Year two takes $32,960.

    Why a steady return flatters the plan

    A single fixed return treats every year alike, and real returns swing from one year to the next. Once withdrawals are running, the order of returns matters: a loss in the first years, when the balance is at its largest and the withdrawals have just begun, does more damage than the same loss twenty years later, because the shares sold at low prices to fund spending are gone before any recovery. That is sequence-of-returns risk. Try a return one or two points lower and watch how far the year the money runs out moves.

    Starting rates and adjusting them

    The 4% rule is a starting rate to test against a schedule like this one, with spending revisited as the years go. Withdrawal rates and guardrails sets out rules for raising or trimming the withdrawal as the balance moves. Guaranteed income shrinks what the portfolio has to cover, so run the Social Security claiming calculator and subtract the benefit from spending first. How much do you need to retire works the other direction, from spending to a target balance. Taxes are not modeled. Withdrawals from a traditional IRA or 401(k) count as taxable income, so what you can spend is less than what you withdraw, and situations differ.

    Questions about this calculator

    Is a 4% first-year withdrawal safe?

    It depends on the returns you actually get, the order they arrive in, how long retirement lasts and whether you adjust spending along the way. At a fixed return above inflation the schedule looks comfortable, and a weak first decade can change that quickly. Treat any rate as a starting point to test and revisit each year.

    Should the return be before or after fees?

    After. Enter the return you expect to keep once fund expenses and any advisory fee come out. A fee is taken from the balance every year, so it compounds against the plan exactly the way a lower return does, and a small difference in the rate moves the year the money runs out.

    Why does the ending balance look so large?

    It is in future dollars. With inflation running every year, a dollar at the end of a long schedule buys far less than one today. The working also shows the ending balance in today's dollars, found by dividing by the rise in prices over the same number of years, which is the figure to compare with your starting balance.

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