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Solve assumes constant per-period withdrawal and end-of-period timing.
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Active in Simulate mode. Disabled in Solve mode.
Use to index withdrawals to inflation. Assumes even growth across periods.
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Used by Solve mode to preserve a terminal value.
Adds dates to the schedule if set.
Results Summary
Max Sustainable Withdrawal
$0
Final Balance
$0
Runout
No
Balance Over Time
Example Scenarios
| Initial | Return % | Years | Freq | Withdrawal/Period | Growth % | Terminal | Mode | |
|---|---|---|---|---|---|---|---|---|
| $500,000 | 5 | 30 | Monthly | $2,000 | 2 | $0 | Simulate | |
| $1,000,000 | 6 | 35 | Monthly | $0 | 0 | $200,000 | Solve | |
| $300,000 | 4 | 20 | Yearly | $18,000 | 2 | $0 | Simulate |
Withdrawal Schedule
| Period | Date | Start Balance | Growth | Withdrawal | End Balance |
|---|
Formulas Used
Notation: P = initial balance, r = annual return (decimal), m = periods/year, i = r/m, N = years × m.
- Simulation update (end-of-period withdrawals): Bt+1 = Bt(1 + i) − Wt, where Wt = W0(1 + gp)t and gp = (1 + g)1/m − 1.
- Closed-form sustainable withdrawal (constant per period): For target terminal value TV,
W = ((P(1+i)N − TV) · i) / ((1+i)N − 1)This assumes withdrawals at the end of each period and no withdrawal indexing.
For inflation-linked withdrawals use the simulation path since a simple closed-form generally does not apply.
How to Use
- Choose Simulate to test a specific withdrawal or Solve to compute a constant sustainable amount.
- Select the withdrawal frequency then enter the initial balance annual return and years.
- In Simulate set the per-period withdrawal and optionally enter an annual growth percentage to index for inflation.
- In Solve optionally set a target ending balance to preserve capital and the tool will compute the per-period amount.
- Click Compute to generate the schedule chart and summary indicators.
- Use Download CSV or Download PDF to export the schedule.
- Load an example to see typical setups and tweak the numbers.
Results are deterministic finance math not investment advice. Real returns taxes and fees vary.
FAQs
Simulate applies your chosen withdrawal amount possibly indexed by inflation and produces a period-by-period path. Solve computes a constant per-period amount that exactly meets a horizon and optional terminal value.
Enter an annual growth percentage for withdrawals. The calculator converts it to a per-period rate so each payment grows smoothly over time approximating inflation indexing.
The schedule stops at the runout period and the chart shows a drop to zero. The summary highlights the runout status so you can adjust withdrawals or horizon.
The closed-form solution assumes a constant per-period withdrawal with end-of-period timing. If you need growth indexing choose Simulate which numerically applies the growth each period.
The annual return is evenly split across the chosen withdrawal frequency so monthly withdrawals apply monthly compounding quarterly uses quarterly and yearly uses annual compounding.
Yes. Enter a target ending balance in Solve mode to preserve capital for bequests or a cushion. The computed withdrawal will be lower than for a zero terminal value.
This is a deterministic amortization style approach. Safe withdrawal rate research often uses historical or Monte Carlo simulations of returns. Use this tool as a planning baseline.