Drawdown Calculator
Test a withdrawal plan: how many years your savings last, what’s left at the end, and how often it survives when returns vary from year to year.
Withdrawals are taken at the start of each year; the rest is invested for the year.
Illustrative only. Each of 1,000 runs draws a random return for every year from a normal distribution with your average and volatility. Real markets have fatter tails, streaks and changing inflation, and your spending may adapt; treat the success rate as a rough gauge, not a forecast.
Balances are at the end of each year. Hover or focus the chart and use the arrow keys to read each year.
Year-by-year table
A fall of X% needs a gain of X ÷ (100 − X) to get back: −20% needs +25%, −50% needs +100%.
How the projection works
Each year the withdrawal comes out first, then the remaining balance earns that year’s return. With Raise withdrawal with inflation on, the amount grows each year so it buys the same as it does today, which is how the classic “4% rule” is defined. Turn it off to model a flat dollar amount.
Steady return assumes the same return every year. It’s a useful baseline and shows the largest first-year withdrawal that just lasts the period.
Monte Carlo replaces the steady return with 1,000 random sequences drawn from a normal distribution with your average and volatility. The success rate is the share of runs that never run dry. The shaded band covers the middle 80% of outcomes; the line is the median. Because losses early in retirement hurt more than the same losses later (sequence-of-returns risk), the median usually ends below the steady-return path even with the same average.
Limits
This is a simple model for exploring ideas, not financial advice. It ignores taxes, fees, Social Security or pensions, changes in spending, and the way real returns cluster and correlate with inflation. Results in Monte Carlo mode are illustrative and depend on the volatility you enter.
Questions
What is the 4% rule?
A rule of thumb from US studies of historical returns: withdraw 4% of your portfolio in the first year of retirement, raise that dollar amount with inflation each year, and a balanced portfolio has historically lasted about 30 years in most periods. Enter 4% of start with inflation raises on to test it against your own assumptions.
How long will $1 million last in retirement?
Taking $40,000 a year rising with 2.5% inflation, with a steady 5% return, $1 million lasts about 37 years. Raise the withdrawal to $60,000 and it runs out in year 21. Volatility shortens both, which the Monte Carlo mode shows.
What success rate should I aim for?
Many planners treat 80–90% as reasonable, because a plan that fails in a few simulated runs can usually be fixed by spending a little less after bad years. A 100% rate often means you could spend more. The number depends heavily on the return and volatility you assume.
Why does the Monte Carlo result change when I click Run again?
Each run set uses a different random seed. With 1,000 runs the success rate usually moves by a point or two between sets, which is a reminder that it’s an estimate.
What is a peak-to-trough drawdown?
The percentage fall from a portfolio’s high point to its lowest point before recovering. The small calculator at the bottom shows the gain needed to get back: a 30% fall needs a 42.86% gain.