Calculator
4% rule calculator
Enter your savings and withdrawal rate. We test it against every 30-year stretch of U.S. market history since 1928 and show how often the money lasted.
65 of 69 past retirements, each starting in a different year from 1928 to 1996, lasted the full 30 years spending $40,000 a year.
- Money left at the end
- Ran short before the end
What this means
Spending $40,000 a year from $1,000,000 lasted the full 30 years in 65 of 69 historical starts (94%). The starts that fell short were 1965, 1966, 1968 and 1969, heading into the high inflation of the late 1960s and 1970s.
The highest steady spending that lasted through every start, including the hardest ones, was about $37,000 a year (3.7% of savings). Spending above that relies on not retiring into a stretch like the worst on record.
With guardrails, which trim spending about 10% after each big drop (up to 20% in the worst starts) and raise it after strong years, the same starting spending lasted in 100% of starts, and spending never fell below $32,000 a year.
This is a test against past markets, not a forecast. It shows how the plan would have held up through real crashes and inflation, which is a better stress test than a single average return.
What the 4% rule says
The 4% rule says you can withdraw 4% of your savings in your first year of retirement, then raise that dollar amount with inflation every year after, and expect the money to last about 30 years. With $1 million, that’s $40,000 in year one, $41,200 the next year if prices rise 3%, and so on, no matter what the market does.
It comes from financial planner William Bengen’s 1994 research, which tested withdrawal rates against historical U.S. returns. He found that roughly 4% was the highest starting rate that survived every 30-year period he studied, including retirements that began right before the Great Depression and the inflation of the 1970s.
Why the result above isn’t always 100%
Our test uses a balanced mix, actual 10-year Treasury returns and a full century of data, so the exact “always worked” rate depends on your stock share and retirement length. The starts that struggle are almost always the same few: retiring in the mid-to-late 1960s, just before a decade of high inflation and flat stock prices.
That’s the main lesson of the 4% rule. It was built to survive the worst stretch on record, so in most historical periods it left retirees with far more money than they started with. Spending stays flat in real terms even when the market soars.
Ways people adjust the 4% rule
- Guardrails. Start near 4.5–5% and agree in advance to trim spending about 10% after big drops, and raise it after strong years.
- A cash bucket. Keep a few years of withdrawals out of stocks so a crash doesn’t force you to sell low.
- A longer horizon. Retiring before 60 often means 35–40 years, which calls for a lower starting rate. Try changing “Years in retirement” above.
Assumptions
- Spending rises with inflation every year and never changes otherwise, as in the classic 4% rule.
- Your savings hold 60% S&P 500 stocks (dividends reinvested) and 40% 10-year Treasuries, rebalanced yearly.
- Each test uses a real 30-year stretch of market history starting in one year from 1928 to 1996.
- Withdrawals happen at the start of each year. Taxes and fees are not included.
New to a term? See the retirement income glossary.
Common questions
Is the 4% rule still safe?
Under historical U.S. returns, a 4% starting withdrawal with a balanced mix lasted 30 years in nearly every start since 1928. The few exceptions began in the late 1960s. Future markets may differ, so many retirees pair the rule with some flexibility, such as guardrails.
Does the 4% rule include Social Security?
No. The 4% applies only to what you withdraw from savings. Social Security, pensions and other income come on top, which is why your total retirement income can be much higher than 4% of savings.
Should I use 4% for a 40-year retirement?
Historically, longer retirements needed lower rates, typically closer to 3.5% with a balanced mix. Set “Years in retirement” to 40 above to see your numbers.
Does the 4% rule account for taxes?
No. The 4% is a gross withdrawal. If your savings are in pre-tax accounts, part of each withdrawal goes to income tax.
Related tools
How we calculate this
We replay your spending through every 30-year stretch of actual U.S. market history since 1928. Each year, the withdrawal comes out first, then the rest earns that year’s real (after-inflation) return for your stock and bond mix. A start “lasts” if every year’s withdrawal was paid in full.
Data: S&P 500 total returns, 10-year Treasury and 3-month Treasury bill returns as compiled by Aswath Damodaran (NYU Stern), and CPI-U inflation from the U.S. Bureau of Labor Statistics, 1928–2025 (2025 preliminary). Read the full methodology and limitations.