Retirement Drawdown Calculator

How to Use the Drawdown Calculator

Enter six numbers and the results update as you type:

1. Current retirement savings. Everything set aside for retirement across your 401(k), IRAs, and taxable accounts, as one total.

2. Annual spending need. What you must pull out per year to live on, in today's dollars, before taxes. Not your portfolio percentage, your actual budget.

3. Expected annual return. A blended long-run average. A 60/40 stock-and-bond portfolio has historically returned roughly 6 to 7% before inflation; an all-bond portfolio closer to 4%.

4. Expected inflation. Defaults to 3%, the long-run US average. This grows your withdrawals every year so the math stays honest.

5 and 6. Current age and plan-to age. Pick a plan-to age past your life expectancy, not at it. Half of 65-year-olds live past their life expectancy; planning to 90 or 95 is how you avoid outliving the money.

A Worked Example

Take a 62-year-old with $750,000 saved who needs $30,000 a year, expects 6% returns and 3% inflation, and plans to 90. That is 28 years. Year one withdraws $30,000, about 4% of the starting balance, while the untouched money compounds at 6%. Each year's withdrawal is 3% larger than the last, because everything costs more. Run it: the money lasts all 28 years, roughly $1,288,000 is withdrawn in total, the portfolio earns about $1,548,000 in growth along the way, and about $1,010,000 remains at age 90. Note that the total withdrawn is far larger than the starting balance. That is compounding doing its job while you spend.

Now change one number: need $60,000 a year instead of $30,000 on the same $750,000. That is an 8% first-year withdrawal rate. The math is brutal: the money runs dry around age 78, about 16 years in, having withdrawn roughly $1,306,000 total. Same saver, same market, double the spending, half the retirement. Spending is the lever.

What the Math Actually Does

Each simulated year, in this order: the year's withdrawal is your spending need grown by inflation for every year since you started, your remaining balance grows by your expected return, then the withdrawal is subtracted. Nothing fancy, just the two forces that decide everything: withdrawals grow exponentially with inflation while returns compound on whatever is left. That ordering is why high spending early is so dangerous; every dollar withdrawn is a dollar that can never compound again.

What the math does not do: it assumes the same return every year. Real portfolios have good years and bad years, and a bad stretch at the start of retirement is far more damaging than the same stretch at the end, because withdrawals taken during a crash are never replaced. That is sequence-of-returns risk, and it is why this calculator is a starting point, not a verdict. Our safe withdrawal rate guide explains the risk and how retirees guard against it.

Who Uses a Drawdown Calculator

The early-retirement check. You are 45, you have $900,000, and you want to know if you can stop working. Forty years of withdrawals is a different animal than 25; the calculator tells you whether the plan survives the extra decade and a half.

The pre-retiree gut check. You are 60 and deciding whether to retire this year or grind two more. Run it both ways: two more years of compounding plus two fewer years of withdrawals is often the single biggest lever you have.

The post-retirement annual review. You are already retired and checking in once a year. Re-run with your actual balance and remaining plan age to see if you are ahead of or behind the plan, and whether spending needs adjusting.

Pair it with the growth side of the story: compound interest calculator for the accumulation years, and our Roth vs Traditional IRA guide for where to hold the money.