Withdrawal Plan Calculator

How long does capital last with regular withdrawals? Including inflation, costs, sequence risk and a simulation.

Assumptions

Initial capital

€

Monthly withdrawal (today’s purchasing power)

€

Amount in the first year. With inflation adjustment it rises every year afterwards.

Adjust the withdrawal for inflation every year

Inflation (% p.a.)

Assumed return before costs (% p.a.)

Running costs, e.g. TER (% p.a.)

Time horizon (years)

years

Assumed volatility for the simulation (% p.a.)

Only used for the simulation. Broad equity portfolios have historically often fluctuated by around 15–20 % p.a., balanced portfolios less.

Result

How long the capital lasts

26 years and 2 months

After that the capital is used up in the model.

Remaining capital at the end (nominal)

€0

Remaining capital in today’s purchasing power

€0

Total withdrawals (nominal)

€814,207

Initial withdrawal rate

4.80%

First-year withdrawals relative to the initial capital

The solid line shows the path with a constant return, the dashed line the same plan with a 25 % loss in the first year.

Sequence-of-returns risk

Losses shortly after withdrawals start hurt more than the same losses later, because units are sold at low prices. Same assumptions, but −25 % in the first year:

Capital used up after 17 years and 10 months.

Simulation with fluctuating returns

In 500 simulated paths (average return 4.0%, volatility 12.0% p.a.), the capital lasted for 30 years in 28.0% of cases.

Remaining capital at the end in today’s money: 10th percentile €0, median €0, 90th percentile €329,567 (10 % of paths end at or below €0, 10 % at or above €329,567).

Simplified model: independent, lognormally distributed annual returns with a fixed seed (reproducible). Real markets have extreme years more often; the result is not a probability for your personal situation.

Annual overview (table)

Year	Withdrawals	Change in value	Capital at year end	Remaining capital in today’s purchasing power
0	€0	€0	€500,000	€500,000
1	€24,000	€18,470	€494,470	€484,774
2	€24,480	€18,250	€488,240	€469,281
3	€24,970	€18,004	€481,275	€453,516
4	€25,469	€17,730	€473,535	€437,474
5	€25,978	€17,426	€464,983	€421,149
6	€26,498	€17,091	€455,576	€404,538
7	€27,028	€16,723	€445,272	€387,636
8	€27,568	€16,322	€434,025	€370,436
9	€28,120	€15,884	€421,789	€352,934
10	€28,682	€15,408	€408,515	€335,125
11	€29,256	€14,893	€394,153	€317,002
12	€29,841	€14,337	€378,648	€298,562
13	€30,438	€13,737	€361,947	€279,797
14	€31,047	€13,091	€343,992	€260,703
15	€31,667	€12,397	€324,722	€241,273
16	€32,301	€11,654	€304,075	€221,502
17	€32,947	€10,858	€281,985	€201,383
18	€33,606	€10,007	€258,386	€180,912
19	€34,278	€9,098	€233,206	€160,080
20	€34,963	€8,129	€206,372	€138,882
21	€35,663	€7,097	€177,806	€117,312
22	€36,376	€6,000	€147,430	€95,363
23	€37,104	€4,833	€115,159	€73,029
24	€37,846	€3,594	€80,908	€50,302
25	€38,602	€2,280	€44,585	€27,176
26	€39,375	€886	€6,097	€3,643
27	€6,105	€9	€0	€0

Assumptions used

Withdrawal rises every year with 2.0% inflation (constant purchasing power).
Return during withdrawal 4.0% p.a. before costs, running costs 0.20% p.a.
Withdrawals at the start of each month.
Taxes are not taken into account.

About the 4 % rule: it comes from US studies of historical returns (e.g. Bengen 1994, the “Trinity study” 1998) for about 30 years and a portfolio of US stocks and bonds. It is not a guarantee; outcomes depend on period, market, costs, taxes and portfolio. Flexible withdrawals (e.g. cutting back after losing years) lead to different results.

Model calculation. The calculation uses constant assumptions and is not a forecast, not a guarantee and not investment advice. Actual returns fluctuate and can be negative. Disclaimer