The 4% rule says you can withdraw 4% of your starting portfolio each year, adjusted for inflation, with a high historical chance of the money lasting 30 years. It comes from the Trinity Study of US market history and is a starting point, not a guarantee.

For a long or early retirement, many planners prefer a more conservative 3.25-3.5% to account for longer horizons, lower expected returns, and sequence-of-returns risk. A higher rate means a higher chance of running short.

How big a portfolio do I need?

Divide your target annual spending by your withdrawal rate. At 4% that is 25 times your spending; at 3.5% it is about 28.5 times.

Safe Withdrawal Rate Calculator (4% Rule)

See the income a portfolio supports and the portfolio a target spend needs at any withdrawal rate.

What a safe withdrawal rate is

Your safe withdrawal rate (SWR) is the percentage of your portfolio you can spend each year without running out over a long retirement. It is the number that turns a pile of savings into an income - and the number that defines your FIRE target. This calculator shows the income a portfolio supports and the portfolio a target income requires.

The 4% rule and its limits

The famous 4% rule comes from the Trinity Study, which tested historical US market returns and found that withdrawing 4% of the starting balance (adjusted for inflation) survived 30 years in nearly all cases. Two cautions:

It was built for a 30-year retirement. Retire at 40 and your money may need to last 50+ years, which argues for a lower rate.
It assumes a specific stock/bond mix and US historical returns, which may not repeat.

Many early retirees use 3.25-3.5% for a margin of safety.

Worked example

A $1,000,000 portfolio at a 4% withdrawal rate:

Annual income: $1,000,000 × 4% = $40,000 (about $3,333 a month)
If your target spend is $50,000, you have a $10,000 shortfall - and would need a $1,250,000 portfolio to fund it at 4%.

Drop the rate to 3.5% and that same $50,000 target needs about $1,430,000 - the cost of extra safety.

Sequence-of-returns risk

The biggest threat to any withdrawal plan is a bad run of returns early in retirement. Selling shares to live on while the market is down can permanently shrink the portfolio. Common defenses:

A cash buffer of 1-2 years of spending to avoid selling in a downturn.
Flexible withdrawals - trimming spending in bad years.
A lower starting rate that leaves room to weather volatility.

How to use the result

Compare a few rates side by side. The difference between 4% and 3.5% looks small but changes your required portfolio by hundreds of thousands of dollars - and your odds of success over a long retirement.

Common mistakes

Applying the 30-year 4% rule to a 50-year early retirement.
Treating the rate as fixed instead of adjusting spending in bad years.
Ignoring taxes, which come out of the same withdrawals.

To project when you reach your target, use the FIRE calculator; to see how your savings rate sets the timeline, see the savings rate calculator.

Last reviewed January 2026. This calculator provides general educational estimates based on the inputs you enter and simplified assumptions. It is not financial, tax, legal or investment advice, and figures may differ from your actual liability. Verify with a licensed CPA or financial advisor before acting.

Safe withdrawal rate calculator