Vanguard dynamic spending calculator

Each year the withdrawal is a percentage of the current balance, then clamped so the real change versus last year cannot exceed a ceiling or a floor.

The calculator

First-year spending$40,0004.0% of the starting portfolio
Spending after the run$50,80130 floor hits, 0 ceiling hits
Ending portfolio$1,270,036After the last year

A 4.0% target with a +5.0% / −2.5% clamp starts at $40,000 and ends at $50,801, with a portfolio of $1,270,036.

Start a 5-day free trial

How it works

Vanguard's published dynamic spending rule computes a target as rate × current portfolio, then forces the real change versus last year to stay inside a ceiling and a floor. The usual defaults are +5% and −2.5%. After a 50% crash the target would collapse; the floor stops spending falling more than 2.5% that year. The Guyton-Klinger calculator is the discrete alternative.

Assumptions

One return every year, no fees, no taxes. The clamp is applied in real terms (last year × (1 + inflation), then ± the cap). A constant return will not exercise the floor the way a real crash would.

Frequently asked questions

How does Vanguard dynamic spending work?
Each year you compute a target withdrawal as a percentage of the current portfolio, then clamp that figure so the real change versus last year stays inside a ceiling and a floor. Vanguard’s published defaults are +5% and −2.5%.
How is this different from Guyton-Klinger?
Guardrails leave spending alone most years and then make a discrete 10% cut or raise. Dynamic spending adjusts a little every year and never moves more than the clamp, even after a crash.
Start a 5-day free trialSee pricing