Free Tool
How Much Can You Safely Withdraw?
Test withdrawal rates from 3% to 6% against historical market conditions. Find the balance between income and longevity.
Withdrawal Rate Simulator
How This Simulator Works
The Model
This simulator tests different withdrawal rates against an illustrative sequence of market returns using a rolling-period analysis. Rather than using average returns (which hide volatility), it replays a representative sequence of hypothetical good and bad years to test whether a given withdrawal rate would sustain across different market environments.
Key Calculations
- Initial withdrawal: Portfolio Value × Withdrawal Rate (e.g., $1M × 4% = $40,000/year)
- Annual adjustment: Each year, the withdrawal amount increases by the inflation rate to maintain purchasing power
- Portfolio update: Each year, Balance = Previous Balance × (1 + Market Return) − Inflation-Adjusted Withdrawal
- Success rate: Percentage of all rolling periods where the portfolio lasted the full retirement length
- Median end balance: The middle outcome across all simulated periods, showing a typical result
Assumptions
- Returns are illustrative, based on a simplified hypothetical 60/40 stock/bond proxy over 50 annual periods
- Withdrawals increase each year by the specified inflation rate
- No taxes, advisory fees, or transaction costs are deducted
- The portfolio is rebalanced annually (implicit in using a blended return)
- A period “fails” if the portfolio balance reaches zero before the retirement length ends
Interpreting Your Results
- Green bars (≥90%) indicate withdrawal rates that were highly sustainable across the illustrative periods
- Amber bars (70-89%) indicate rates that survived most periods but carry meaningful risk
- Red bars (<70%) indicate rates with a high probability of running out during retirement
- The detailed table shows annual/monthly income, success rate, and the typical ending portfolio balance
- A higher success rate provides a greater margin of safety for unexpected expenses or longer-than-expected life
Tips for Using This Tool
- The “4% rule” is a common starting point, but your ideal rate depends on your full financial picture
- Try extending the retirement length to 35-40 years to stress-test against longer lifespans
- Higher inflation rates significantly reduce purchasing power, try 3-4% to see the impact
- A 90%+ success rate provides a reasonable margin of safety, but some advisors recommend targeting 95%+
- In practice, retirees can adjust spending in bad years, this rigid model may understate actual sustainability
Illustrative Success Rate by Withdrawal Rate
Based on rolling 30-year periods using a diversified portfolio
Detailed Comparison
| Rate | Annual Income | Monthly Income | Success | Median End Balance |
|---|---|---|---|---|
| 3% | $30,000 | $2,500 | 100% | $2,001,137 |
| 3.5% | $35,000 | $2,917 | 100% | $1,475,893 |
| 4% | $40,000 | $3,333 | 100% | $1,077,800 |
| 4.5% | $45,000 | $3,750 | 100% | $619,321 |
| 5% | $50,000 | $4,167 | 57% | $126,911 |
| 5.5% | $55,000 | $4,583 | 19% | $0 |
| 6% | $60,000 | $5,000 | 5% | $0 |
The 4% rule as a starting point. At a 4% withdrawal rate, a $1,000,000 portfolio provides $40,000/year ($3,333/month) in initial retirement income, increasing with inflation each year. But your ideal rate depends on your specific situation, tax strategy, Social Security timing, and spending flexibility all play a role.
This simulator uses simplified, hypothetical return sequences for a diversified portfolio and is for illustrative purposes only. It does not account for taxes, fees, sequence-of-returns risk in full detail, or individual circumstances. Actual results will vary. Past performance does not guarantee future results. Consult a qualified financial advisor before making withdrawal decisions. Rubric Advisors, LLC accepts no liability for any loss or damage arising from the use of this tool.
All computation happens in your browser. No data leaves your device.
This simulator is provided for educational and informational purposes only. It uses simplified historical return sequences and does not account for taxes, fees, or individual circumstances. Actual withdrawal sustainability depends on many factors including asset allocation, tax situation, Social Security benefits, and spending flexibility. Past performance does not guarantee future results. Please consult with a qualified financial advisor before making retirement withdrawal decisions. Rubric Advisors, LLC accepts no liability for any loss or damage arising from the use of this tool. All computation happens entirely in your browser and no data is transmitted or stored.
Brought to you by Rubric Advisors
Related guides
401(k) Withdrawal Rules
Rules for 401(k) distributions, early withdrawal penalties, Rule of 55, hardship withdrawals, loans, 72(t) payments, RMDs, and rollover options explained.
403(b) Plans, Retirement Savings for Educators and Nonprofit Employees
403(b) plans serve public school employees, nonprofits, and churches. They share many features with 401(k) plans but have unique rules, investment options, and potential pitfalls.
457(b) Plans: Deferred Compensation for Executives
457(b) plans allow executives to defer additional compensation beyond 401(k) limits, with unique withdrawal flexibility and planning opportunities.
529 Plans
529 Plans are tax-advantaged investment accounts designed for education expenses, offering tax-free growth and withdrawals for qualified costs including college tuition, K-12 tuition (up to $10,000/year), and student loan repayments.
More Free Tools
Ready to put these insights to work? See our approach or talk to an advisor.