You have spent decades saving. The harder question is the one that comes next: how much can you actually pull out each month without running out of money before you run out of life? This retirement withdrawal calculator answers that question directly. It starts from your nest egg, applies an initial withdrawal rate such as the famous 4% rule, raises your withdrawals each year for inflation, and projects year by year whether your portfolio survives the whole length of retirement.
Slide the inputs and every figure updates instantly: your year-one annual spending, your monthly spending, what that spending grows to in your final year after inflation, the total dollars you withdraw over the period, and the balance you are projected to leave behind.
How to Use
- Enter your Retirement Nest Egg — the total savings sitting in your 401(k), IRA, and brokerage accounts on the day you retire.
- Set your Initial Withdrawal Rate. The classic default is 4.0%; if you want a more conservative plan or expect a longer retirement, try 3.0% or 3.5%.
- Choose your Expected Annual Return. A balanced 60/40 portfolio historically runs around 7% nominal; a more conservative bond-heavy portfolio might be 4–5%.
- Set the Inflation Rate. A long-run average near 3% is the standard assumption, and it is what makes your later-year withdrawal far larger than your first-year check.
- Pick your Years in Retirement. Thirty years is the benchmark (retiring around 62–65 and living to 90–95). Early retirees should use 40 or more.
The result card shows your year-one withdrawal in both annual and monthly terms, the inflation-adjusted withdrawal in your final year, the total you would withdraw over the whole period, and your projected ending balance. A positive ending balance means the money lasts; a negative one flags a plan that runs dry early.
The 4% Rule and How the Math Works
The 4% rule traces back to William Bengen's 1994 study and was later popularized by the Trinity Study. It found that a diversified portfolio could safely support an initial withdrawal of about 4% of the starting balance, with that dollar amount raised each year for inflation, for at least 30 years in nearly all historical market cycles.
The engine here uses a transparent year-by-year decumulation model:
- Year-one withdrawal = nest egg × withdrawal rate. On a $1,500,000 nest egg at 4%, that is $60,000 per year, or $5,000 per month.
- Each later year, the withdrawal grows by inflation. At 3% inflation, the year-30 withdrawal is about $60,000 × 1.03²⁹ ≈ $141,394.
- The portfolio balance each year follows: ending balance = (beginning balance − withdrawal) × (1 + return).
On the default $1.5M at 4%, 7% return, and 3% inflation over 30 years, the portfolio not only survives but grows: the ending balance projects to roughly $3.1 million, and you withdraw about $2.85 million in total. That cushion is why a 4% withdrawal is considered safe — your portfolio's real return roughly keeps pace with your rising spending.
If the return is lower or the withdrawal rate is higher, the same model shows the balance draw down and eventually turn negative, which is the signal to save more, retire later, or spend less.
Examples
Example 1 — The classic $1.5M retiree. With a $1,500,000 nest egg, a 4% withdrawal rate, 7% annual return, 3% inflation, and 30-year retirement, you can spend $60,000 in year one ($5,000 per month). By year 30, that spending has grown to about $141,394 to maintain the same purchasing power, and the portfolio still ends with roughly $3.1 million.
Example 2 — A million-dollar baseline. A $1,000,000 nest egg at the same 4%, 7%, 3%, 30-year assumptions produces $40,000 per year ($3,333 per month) in year one, growing to about $94,263 by year 30, with an ending balance near $2.06 million.
Example 3 — A larger nest egg, shorter horizon. With $2,000,000, a more aggressive 5% withdrawal rate, 6% return, 2.5% inflation, and a 25-year horizon, you can pull $100,000 in year one ($8,333 per month), rising to about $180,873 in year 25, while still leaving roughly $1.2 million to heirs.
Example 4 — Stress-testing a conservative plan. Dropping the withdrawal rate to 3% on a $1.5M nest egg cuts year-one spending to $45,000 ($3,750 per month), but it dramatically widens the safety margin — exactly what investors worried about a early-market crash should model before pulling the trigger.
FAQ
What is the 4% rule?
The 4% rule is a guideline suggesting you withdraw 4% of your retirement savings in your first year of retirement, then adjust that dollar amount each subsequent year for inflation. Backed by Bengen's 1994 research and the Trinity Study, it aims to make a portfolio last at least 30 years.
How much can I withdraw from $1.5 million?
At the standard 4% rate, a $1.5 million nest egg supports $60,000 in the first year, or about $5,000 per month. After 3% inflation each year, that monthly spending rises over time to maintain the same purchasing power.
How long will my retirement savings last?
It depends on your withdrawal rate, returns, and inflation. At 4% with 7% returns and 3% inflation, a balanced portfolio typically lasts 30 years or more. Use this calculator's ending-balance figure: a positive number means the money lasts, while a negative number shows you running out early.
Is a 4% withdrawal rate too risky today?
Some researchers argue that low bond yields and high valuations argue for 3–3.5%. The 4% rule is a starting point, not a guarantee. Enter a lower withdrawal rate to model a more conservative plan, and consider adjusting spending if markets drop early in retirement.
Should I adjust my withdrawal for inflation?
Yes. Your first-year dollar amount will not buy the same groceries in 20 years. Raising withdrawals by inflation each year — typically around 3% — preserves your standard of living, which is why this calculator grows withdrawals every year rather than holding them flat.
What withdrawal rate is safe for early retirement?
Early retirees who need their money to last 40 or 50 years often use 3–3.5% instead of 4%. Set the Years in Retirement field to 40 or more and lower the withdrawal rate to 3% to see how that changes monthly spending and survival.
Disclaimer
This retirement withdrawal calculator is provided for informational purposes only and does not constitute financial, investment, tax, or legal advice. Projections rely on the inputs you enter and a simplified constant-return model; actual market returns, inflation, and spending vary widely and sequence-of-returns risk is not captured. Always confirm your retirement plan with a qualified financial advisor before making withdrawal decisions.