Analyze your portfolio longevity over a 25-year horizon
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Initial Withdrawal Rate:0.00%
Projected Outcome (25 Years):—
Final Portfolio Balance:—
Final Annual Withdrawal (Inf. Adj.):—
Understanding the 25-Year Retirement Horizon
Planning for retirement involves balancing your savings against your spending needs over time. A Retirement Withdrawal Rate Calculator for 25 Years is specifically designed for retirees targeting a specific time horizon—often utilized by early retirees bridging the gap to pensions or those planning a standard retirement period from age 65 to 90.
What is a Safe Withdrawal Rate?
The "Safe Withdrawal Rate" (SWR) is the percentage of your initial portfolio that you can withdraw in the first year of retirement, adjusting subsequent withdrawals for inflation, without running out of money before the end of your planning horizon. The most famous benchmark is the 4% Rule, which suggests that a portfolio of 50% stocks and 50% bonds has a high probability of lasting 30 years with a 4% initial withdrawal.
Key Inputs in this Calculation
Initial Portfolio Value: The total value of your investable assets (IRAs, 401ks, brokerage accounts) at the start of retirement.
Annual Withdrawal: The amount of money you need to pull from your investments to cover living expenses in the first year.
Expected Annual Return: The average compound annual growth rate (CAGR) you expect your investments to achieve. Historically, the S&P 500 has returned about 10% nominally, but conservative estimates for diversified portfolios often range from 5% to 7%.
Inflation Rate: This calculator increases your withdrawal amount every year to maintain your purchasing power. If inflation is 3%, a $50,000 withdrawal in Year 1 becomes $51,500 in Year 2.
Sequence of Returns Risk
While this calculator uses a fixed average return, real life involves volatility. "Sequence of Returns Risk" refers to the danger of experiencing poor market returns early in your retirement. If the market drops 20% in your first two years while you are also withdrawing funds, your portfolio depletes faster, making it harder to recover even if returns are good later. For a 25-year horizon, flexibility is key. Being able to reduce spending during market downturns can significantly increase your success rate.
Why 25 Years?
A 25-year horizon is a common planning period for:
Retirees retiring at age 65 expecting to live to 90.
Individuals utilizing a "bridge" fund before Social Security or other annuities kick in.
Conservative planners who want to ensure capital preservation over a quarter-century.
Use the calculator above to test different scenarios. If your result shows depletion before year 25, consider lowering your initial withdrawal rate, saving more capital, or adjusting your investment allocation to potentially achieve higher returns (though this comes with higher risk).
function calculateWithdrawal() {
// 1. Get Input Values
var portfolioStr = document.getElementById("portfolioValue").value;
var withdrawalStr = document.getElementById("annualWithdrawal").value;
var returnStr = document.getElementById("annualReturn").value;
var inflationStr = document.getElementById("inflationRate").value;
// 2. Validate Inputs
if (portfolioStr === "" || withdrawalStr === "" || returnStr === "" || inflationStr === "") {
alert("Please fill in all fields to calculate.");
return;
}
var portfolio = parseFloat(portfolioStr);
var startWithdrawal = parseFloat(withdrawalStr);
var returnRate = parseFloat(returnStr) / 100;
var inflationRate = parseFloat(inflationStr) / 100;
var years = 25;
// 3. Basic Logic Check
if (isNaN(portfolio) || isNaN(startWithdrawal) || isNaN(returnRate) || isNaN(inflationRate)) {
alert("Please enter valid numbers.");
return;
}
// 4. Calculate Initial Withdrawal Rate
var initialRate = (startWithdrawal / portfolio) * 100;
// 5. Simulation Loop
var currentBalance = portfolio;
var currentWithdrawal = startWithdrawal;
var depletedYear = -1;
for (var i = 1; i <= years; i++) {
// Assume withdrawal happens at the BEGINNING of the year
currentBalance = currentBalance – currentWithdrawal;
// Check if money ran out
if (currentBalance < 0) {
depletedYear = i;
currentBalance = 0;
break;
}
// Apply investment growth to remaining balance
currentBalance = currentBalance * (1 + returnRate);
// Adjust withdrawal for inflation for the NEXT year
currentWithdrawal = currentWithdrawal * (1 + inflationRate);
}
// 6. Format and Display Results
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
minimumFractionDigits: 0,
maximumFractionDigits: 0,
});
document.getElementById("resRate").innerHTML = initialRate.toFixed(2) + "%";
var statusEl = document.getElementById("resStatus");
if (depletedYear !== -1) {
statusEl.innerHTML = "Depleted in Year " + depletedYear + "";
document.getElementById("resBalance").innerHTML = "$0";
document.getElementById("resFinalWithdrawal").innerHTML = "N/A";
} else {
statusEl.innerHTML = "Fully Funded for 25 Years";
document.getElementById("resBalance").innerHTML = formatter.format(currentBalance);
document.getElementById("resFinalWithdrawal").innerHTML = formatter.format(currentWithdrawal);
}
document.getElementById("results").style.display = "block";
}