SWP Calculator

How to use this calculator

Enter your Retirement Corpus (total savings), the Monthly Withdrawal amount you plan to take, the Expected Annual Return from your investment portfolio, and an Inflation Rate to model purchasing-power-adjusted withdrawals.

The calculator simulates month-by-month withdrawals and returns:

• Portfolio Duration: how many years the corpus lasts
• Duration in Months: same value in months
• Total Amount Withdrawn: cumulative cash received
• Max Sustainable Monthly (30 yrs): the maximum withdrawal that sustains the portfolio for 30 years

How the 4% rule became the retirement planning standard

The 4% rule originated from the “Trinity Study” (1998) by three Texas professors. They found that a portfolio of 50% stocks / 50% bonds, withdrawing 4% of the initial value per year (inflation-adjusted), survived 30-year retirement periods in nearly all historical scenarios.

The math: 4% rule vs. withdrawal amount

Corpus	4% Annual Withdrawal	Monthly Income
$250,000	$10,000	$833
$500,000	$20,000	$1,667
$750,000	$30,000	$2,500
$1,000,000	$40,000	$3,333
$1,500,000	$60,000	$5,000
$2,000,000	$80,000	$6,667

The 4% rule was derived from historical U.S. market returns. Critics argue that in a lower-expected-return environment (current elevated valuations), 3–3.5% is a safer withdrawal rate for 40+ year retirements. Use the calculator to model your specific assumptions.

How return rate and withdrawal interact

The relationship between return and withdrawal rate determines whether a portfolio survives. When the monthly return exceeds the withdrawal rate (as a % of the balance), the portfolio grows. When it falls short, the balance declines.

Duration of $500,000 at various return rates and monthly withdrawals:

Monthly Withdrawal	5% Return	7% Return	9% Return
$1,500	60+ years	60+ years	Indefinite
$2,000	47 years	60+ years	Indefinite
$2,500	34 years	58 years	Indefinite
$3,000	26 years	39 years	60+ years
$3,500	20 years	27 years	50 years
$4,000	16 years	21 years	33 years

No inflation adjustment in this table. Add inflation to see compressed durations.

At 7% return, withdrawing $3,000/month ($36,000/year = 7.2% of corpus) depletes a $500,000 corpus in ~39 years. The portfolio’s interest income partially offsets withdrawals, extending the timeline significantly beyond a zero-return scenario.

How inflation quietly erodes your retirement withdrawals

Fixed withdrawals lose purchasing power over time. $3,000/month today is equivalent to only $1,655/month after 20 years at 3% inflation. Adjusting withdrawals upward for inflation is the realistic model, but it depletes the corpus faster.

Effect of inflation adjustment on $500,000 corpus, 7% return, $2,500/month starting withdrawal:

Inflation Rate	Portfolio Duration	Total Withdrawn
0% (fixed)	58 years	$1,740,000
2%	39 years	$1,555,000
3%	33 years	$1,390,000
4%	28 years	$1,240,000
5%	24 years	$1,115,000

FIRE timeline: how much do you need to retire?

FIRE (Financial Independence, Retire Early) uses the inverse of the 4% rule: multiply your target annual spending by 25 to determine required corpus.

FIRE target corpus by annual spending:

Annual Spending	4% Rule Corpus	3.5% Rule Corpus	3% Rule Corpus
$20,000 ($1,667/mo)	$500,000	$571,000	$667,000
$30,000 ($2,500/mo)	$750,000	$857,000	$1,000,000
$40,000 ($3,333/mo)	$1,000,000	$1,143,000	$1,333,000
$60,000 ($5,000/mo)	$1,500,000	$1,714,000	$2,000,000
$80,000 ($6,667/mo)	$2,000,000	$2,286,000	$2,667,000
$100,000 ($8,333/mo)	$2,500,000	$2,857,000	$3,333,000

FIRE advocates recommend targeting a 3% withdrawal rate for early retirees (40s/50s) to ensure the corpus survives 50+ years. The 4% rule was designed for 30-year retirements.

Sequence-of-returns risk

The biggest risk in SWP-based retirement is not average returns; it’s the order of returns. Getting poor returns early in retirement while withdrawing is catastrophic. Good early returns provide a cushion.

Illustration: Same average return, different sequences

Portfolio: $500,000 | Withdrawal: $30,000/year

Sequence A: Returns of −20%, 0%, 10%, 20%, 12%, 10%, 10%, 10%, 10%, 10% Sequence B: Returns of 10%, 10%, 10%, 10%, 12%, 20%, 10%, 0%, −20%, 10%

Both sequences average ~7.2% per year. But:

• Sequence A (bad returns first): Corpus depleted in ~22 years
• Sequence B (good returns first): Corpus exceeds $750,000 after 10 years, lasts 30+ years

The bottom line

The SWP calculator answers the fundamental retirement question: “Will my money last as long as I need it to?”

Key rules of thumb:

• Withdraw no more than 4% per year for 30-year retirements (3% for 40+)
• Every 1% increase in withdrawal rate roughly halves the portfolio duration near the boundary
• Inflation is the most dangerous variable. A 3% inflation rate compresses corpus life significantly.
• The return rate matters more than the withdrawal amount when you are near the sustainability threshold

Model your actual expected return, inflation, and target monthly income to find your personal sustainable corpus size.