retirement · 2026-05-01
Run the 4% rule (and variants 3%-5%) against your portfolio to project annual safe withdrawals over a defined retirement length.
| Portfolio at retirement | $1,500,000 |
| Withdrawal rate % | 4% |
| Retirement length (yrs) | 30 |
| Annual inflation % | 3% |
| Pre-fee return % | 7% |
| Annual fees % | 0.5% |
| Total nominal withdrawn | $2,854,525 |
| Projected ending balance | $2,277,094 |
| Real return (after inflation + fees) | 3.50% |
The 4% rule (William Bengen, 1994) says: withdraw 4% of your starting portfolio in year 1, then increase that withdrawal each year by inflation. With a 60/40 stock/bond portfolio, this rule survived all 30-year retirement starting points from 1926-1990 in his backtest.
Because the 4% rule was designed for 30-year horizons. If you retire at 50, you might need 40-50 years of money — drop to 3-3.5%. If you'll have substantial Social Security income at 70, you can be more aggressive in the gap years. Static 4% ignores these adjustments.
Same math, expressed differently: if you withdraw 4% per year, you need 25× annual spending. $50k/yr lifestyle = $1.25M nest egg. Useful as a quick check but suffers all the same sequence-of-returns risk as the 4% rule.
Yes — subtracted from gross returns. A 1% advisor fee + 0.4% fund fees = 1.4% drag. Over 30 years, that turns 4% safe withdrawal into ~3.2%. Aggressively minimize fees pre-retirement: every basis point compounds for decades.