4% rule calculator

William Bengen’s 1994 rule of thumb as a first-year income: 4% of the starting portfolio, then that dollar amount plus inflation. The rate is locked at 4% on this page.

The calculator

Portfolio ($)

Total annual fees (%)

First-year income at 4%$40,000

After fees$40,000

Monthly$3,333

Multiple25.0×

4% of $1,000,000 is $40,000 in year one.

Run 1,000 market paths

Success rate53%1000 seeded paths

10th percentile ending$0

Median ending$83,330

90th percentile ending$3,174,969

What the 4% rule is

Year-one spending is 4% of the starting balance. Later years raise that dollar amount with inflation and never re-read the portfolio. After a 30% fall, the same withdrawal is 5.7% of what is left. The safe withdrawal rate calculator is the same identity with a rate you can change. The 4% study is the 5,000-path version.

Assumptions

Pre-tax, 30-year band, 2% inflation in the optional paths. Bengen’s original windows were 30 years. A retirement at 40 is not a 30-year problem — see withdrawal rates by age.

Frequently asked questions

What is a 4% rule calculator?

A tool that applies William Bengen’s 1994 rule of thumb: withdraw 4% of the portfolio in year one, then raise that dollar amount with inflation. This page locks the rate at 4%.

Is this the same as the safe withdrawal rate calculator?

Same identity, fixed at 4%. Use the safe withdrawal rate calculator to try 3.5% or 3% — those are the rates a longer retirement often needs.

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