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4% rule calculator
The 4% rule answers the retiree’s question: given the portfolio you have, how much can you spend? Set your balance and rate — the answer is your first-year withdrawal, in today’s dollars.
Bengen’s original finding was that 4% survived every historical 30-year retirement in his data — drag the rate to see how sensitive your spending is to that one assumption.
What the 4% rule actually says
In 1994, financial planner William Bengen tested a simple strategy against every historical retirement start year in his data: withdraw 4% of the portfolio in year one, then give yourself a raise for inflation every year after, regardless of what markets do. That starting rate survived even the worst 30-year stretches — retiring into the Great Depression or the 1970s stagflation. The later Trinity study (1998) broadened the evidence and made “4%” the default planning shorthand.
Two things people miss: the rule is a first-year percentage (after that you track inflation, not the portfolio), and it was built on a 30-year horizon — early retirees planning 40–50 years often prefer a lower rate. Our 4% rule guide covers the research, its data vintage, and the modern critiques.
What this calculator skips
Portfolio × rate is arithmetic; the hard part is everything around it — taxes on withdrawals, the order you drain accounts, Social Security arriving mid-retirement, and the market’s sequence of returns. Two retirees with the same balance and rate can have very different outcomes because of those.
The full Calcifir planner runs your plan against real market history and 5,000 simulated futures, with taxes and Social Security modeled — free to start. See your chance of success.
Common questions
Do I withdraw 4% of the balance every year?
No — that’s the most common misreading. You take 4% of the starting portfolio once, then adjust that dollar amount for inflation each year. (Withdrawing a fixed percentage of the current balance is a different strategy with different behavior.)
Is 4% still safe today?
It’s debated. The rule passed history’s worst cases, but today’s valuations and longer retirements push many planners toward 3.25–3.75% — and toward flexible strategies that cut spending in bad years instead of holding one fixed rate.
What about taxes?
The withdrawal here is gross — what leaves the portfolio, not what lands in your checking account. Draws from pre-tax accounts are taxed as income, so your spendable amount is lower unless your money is in Roth or taxable accounts with high basis.
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