See how long your savings will last, or how much you can safely withdraw.
A withdrawal rate is a percentage of your starting balance taken out each year. A commonly cited figure is 4% annually, based on how a set of historical returns held up over roughly 30-year retirements, but that time horizon is part of the math, not a separate factor: a shorter payout period supports a higher rate before running out, and a longer one needs a lower rate. Your actual investment return and inflation move the number too, which is why this calculator asks for a rate directly instead of assuming one.
If your investment returns each period exceed what you withdraw, the balance keeps compounding upward even as you take money out. If withdrawals exceed returns, the balance shrinks, slowly at first, then faster, as a smaller balance earns less in absolute terms while withdrawals stay fixed.
The balance falls from both directions at once, through the withdrawal and through the loss, so it runs out sooner than the same withdrawal rate would suggest on its own.
This calculator applies one constant rate for the whole period. Real returns vary, and a run of poor years early in a withdrawal period does more damage than the same years later, because the withdrawals come out of a portfolio that has already shrunk.
Safe withdrawal rate is the percentage of your starting balance you can withdraw each year without running out of money over a given time horizon. This applies the same way whether the balance is in a taxable brokerage account, a 401(k), or an IRA. A commonly cited rule of thumb is 4% annually, based on historical market returns holding up over 30-year retirements, but the right rate depends heavily on your actual investment return, inflation, and how long the money needs to last.
Whether your balance grows or shrinks comes down to a simple comparison: if your investment returns each period exceed what you withdraw, the balance keeps compounding upward even as you take money out. If withdrawals exceed returns, the balance shrinks, slowly at first, then faster, as a smaller balance earns less in absolute terms while withdrawals stay fixed.
The depletion time for a fixed periodic withdrawal comes from solving the annuity formula for the number of periods n: balance × (1+r)ⁿ = withdrawal × [(1+r)ⁿ − 1] / r, where r is the periodic return rate. Rearranged for n, this becomes a logarithm, which is why small changes in withdrawal rate or return can shift the payout horizon by years, not just months.